Student employees performing necessary work toward a sponsored project may receive a Tuition Reduction Benefit (TRB). The “necessary work” requirement is outlined in 2 CFR 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards.
Beginning with academic year 2013 – 2014, sponsored tuition for specific job categories for students (such as GRAs, TAs, AIs) will be processed on a Tuition Reduction Benefit document (SS3). The change is well described on the Graduate School’s website.
This procedure improvement enables the university to better comply with the federal government’s guidance on sponsored tuition, alleviating the tax burden for sponsored students.
Special Handling Procedure
The Tuition Reduction Benefit (TRB) requires special handling for sponsored students without an employment relationship with the University (who may be employed by a third party such as a corporation, foundation, etc.). To be eligible for this special handling provision of TRB from a sponsored project, the student must perform duties necessary to the scope of work of the sponsored program funding tuition. Follow the process below for these students:
- Process tuition via the TRB by creating an SS3 document in FRMS.
- Ignore any text about a missing position assignment on the titles TA/AI/GRA.
- On the 12th and 20th class day, the student and the SS3 creator will receive email notices stating that their tuition will be removed without an assignment to GRA/TA/AI .
- When the 1st notice is received, notify OSP Post-Award via email at firstname.lastname@example.org that the student needs to continue to receive the tuition payment. Provide the following in your email:
- the SS3 document ID,
- the 26- account number to which the tuition is being directed,
- the UT EID of the affected student,
- an explanation as to why the student is missing a UT GRA/TA/AI assignment, and
- the work requirements of the student(s) in order to receive the tuition remission.
Once the above information and the appropriate justification have been received, Post-Award will work with Student Accounts Receivable to ensure tuition coverage remains as processed.
Post-Award strives to help the departments at the earliest opportunity, so the department may choose to notify them at Step 1, when the SS3 is created. Unfortunately, we are currently unable to prevent the notices from being sent on the 12th and 20th class day.
Students receiving scholarships/fellowships support from a training grant (or similar award with a 70-subaccount) for which the primary purpose of the award is to fund student learning, may continue to receive scholarships/fellowships via an SS1 document created in FRMS.
The SS3 cannot cover ISSS fees. A companion SS2 document would need to be processed to cover those fees. SS2 documents are currently still created in *DEFINE. When processing an SS2 on a sponsored project, the processor must mark the “Duties Required” question as “Y” for Yes. Tax will be applied.
To create an employment-related SS2 on sponsored funds to cover the ISSS fee:
- On the SS2 cover sheet mark Section 3, and then
- mark funded by Sponsored Funds (26-account) and is NOT for a fellowship (only to cover ISSS fee for student with a TRB on the same grant).
To create an AR code that covers the ISSS fee:
- Leave the Tuition Portion Covered field blank.
- Enter P in the Other field to go to the Other fees pop-up window.
- Then mark only the Int'l Stud/Schlrs field.
- Note: The document can be approved if it covers only the ISSS fee.
For questions about this procedure, contact the Office of Accounting Special Billing section at email@example.com.
The United States Office of Management and Budget (OMB) states in 2 CFR 200, “However, tuition remission and other forms of compensation paid as, or in lieu of, wages to students performing necessary work are allowable provided that…the tuition or other payments are reasonable compensation for the work performed and are conditioned explicitly upon the performance of necessary work.” This is the fourth of five stated conditions for allowability of tuition remission paid by a federal sponsor. 2 CFR 200.466 Scholarships and student aid costs continues on stating that, “Charges for tuition remission and other forms of compensation paid to students as, or in lieu of, salaries and wages shall be subject to the reporting requirements in § 200.430 Compensation—personal services.
Principal Investigators, when you certify effort for your students which was compensated with tuition remission in lieu of salary, or as salary, you are certifying that the student performed duties that are necessary to the sponsored project as a condition of earning their compensation.
Additional guidance and regulation is provided in the Clarification Memo that OMB issued in 2001, “Clarification: OMB in the Circular did not intend to tie the allowability of tuition remission costs to how they are treated for tax purposes.”
For FY 2014-2015 the governing regulation will be the revised 2 CFR 200.
Principal Investigators, the Handbook of Operating Procedures outlines policy for students (GRAs, TAs, AIs) at The University of Texas at Austin.
Tuition remission for graduate research assistants (GRAs) has been required on all grant proposals and contracts allowing tuition remission as a cost, since 2001 when the Vice President for Research, Scholarship and Creative Endeavors and the Faculty Council issued the following policy document: https://research.utexas.edu/wp-content/uploads/sites/5/2015/10/tuition_remit.pdf
Human Resource Services has a webpage on Student Employee Compensation: https://hr.utexas.edu/student/student-employee-compensation
SS3s and SS2s processed as requiring duties are included in the effort certification process conducted semi-annually. Visit the effort certification page for more information.
If you have any questions about this information, contact Post-Award at firstname.lastname@example.org.