Employee Tuition Benefit Program

Revised May 2014

Definition of Tuition Benefit


Benefits for Full-Time and Reduced Full-time Employees and their Dependents

Tuition discounts for education at Abilene Christian University is provided to all full-time and reduced full-time employees and their dependents based upon the length of employment with ACU.

These tuition discount percentages will be calculated as follows:

1st Year of Employment50% discount on tuition
2nd Year of Employment and thereafter75% discount on tuition*
Effective August 2015
1st Year of Employment25% discount on tuition
2nd Year of Employment50% discount on tuition
3rd Year of Employment75% discount on tuition

Full-Time Employees and Reduced Full Time Employees

Full-time and reduced full-time employees of Abilene Christian University are eligible to apply for a discount in tuition for courses taken at ACU for up to six hours during any fall, spring and/or the combined summer terms.  If classes will take place during employee's scheduled working hours, the employee's supervisor must approve all classes before enrollment. Time spent in class will not be counted as part of the employee's work schedule, unless approved in advance by the employee's supervisor and vice president of the employee's area. The course must be taken outside scheduled working hours or an equivalent adjustment must be made in the employee's work schedule.

Spouses and Dependent Children – For classes taken at ACU, a full-time/reduced full-time employee may apply for a tuition discount for up to thirty-six credit hours for his or her spouse and children during the academic year. PLEASE NOTE: effective August 2015, dependent children must meet the definition of a dependent, as defined by the Internal Revenue Service.

If a full-time or reduced full-/time employee dies while employed by ACU, his or her spouse and children will continue to be eligible for the tuition discounts as listed for retirees.

Benefits for Half-Time Employees

Tuition discounts for education at Abilene Christian University is provided to half-time employees and their dependents based upon the length of employment with ACU.  Half-time employees are defined as employees who work between 20 and 31 hours a week or who are half-time faculty members.

These tuition discount percentages will be calculated as follows:

1st Year – 4th Year of Employment  0% discount on tuition
5th Year of Employment and thereafter 50% discount on tuition

Half-time employees of Abilene Christian University are eligible to apply for a discount in tuition for courses taken at ACU for up to six hours during any fall, spring and/or the combined summer terms.  If classes will take place during employee's scheduled working hours, the employee's supervisor must approve all classes before enrollment. Time spent in class will not be counted as part of the employee's work schedule, unless approved in advance by the employee's supervisor and vice president of the employee's area. The course must be taken outside scheduled working hours or an equivalent adjustment must be made in the employee's work schedule.

Spouses and Dependent Children – For classes taken at ACU, a half-time employee may apply for a tuition discount for up to thirty-six credit hours for his or her spouse and children during the academic year. PLEASE NOTE: effective August 2015, dependent children must meet the definition of a dependent as defined by the Internal Revenue Service.

Benefits for Retirees

When a full-time employee retires from the university, that retiree, his or her spouse and children will continue to be eligible to apply for the tuition benefit. The amount of such discount shall be based on the university's program for such tuition discounts at the time or times they are awarded.

Limitation of Benefits


Admission Requirements

Eligibility for the benefit does not guarantee admission to the University.  Employees and dependents must meet the admissions requirements in order to receive the ACU benefit.

Age Limits for Children

Full-time employees and retirees are eligible to apply for a tuition discount for their children until the semester after the child's 25th birthday. PLEASE NOTE: effective August 2015, dependent children must meet the definition of an IRS dependent. In general, an IRS dependent is an unmarried child who will not reach the age of 24 by the end of the calendar year.

Limits on Discounted Tuition

The tuition benefit is to be awarded on the full tuition price of credit hours attempted. If courses are being taken at a reduced rate (such as dual credit and summer academy) the tuition benefit will not be awarded.

ACU Online Degree Programs

The benefit can apply to tuition charges for online programs. However, the benefit may not be applied to fees for online programs.

Credit Hour and Number of Degree Limitations

For employees, the tuition benefit can be applied to tuition charges for the lesser of 190 attempted credit hours or one baccalaureate degree and one post-baccalaureate degree. For dependents, the tuition benefit can be applied to tuition charges for the lesser of 190 attempted credit hours or one baccalaureate degree. PLEASE NOTE: Effective August 2015, the tuition benefit for dependents can be applied to the lesser of 144 attempted hours or one baccalaureate degree.

Refunds for Withdrawals and Repeat Classes

No cash refund of the tuition benefit will be awarded to an ACU employee or to any member of the employee's family for withdrawn courses.

A student may repeat a course one time and still receive the tuition benefit.

Employees, spouses and children enrolled in degree seeking programs must maintain satisfactory academic progress to qualify for this tuition benefit.

Additional Institutional Awards

The tuition benefit may be combined with other institutional aid (1). However, in no event will the total institutional aid in combination with the benefit exceed the total amount of institutional charges (2) each semester. The faculty/staff tuition benefit will always be applied first, and in some cases scholarships may need to be reduced in order to meet this requirement.

  1. Institutional aid such as merit or achievement scholarships, departmental awards and endowed scholarships
  2. Institutional charges are defined as tuition, required fees (not course fees), and on-campus room (excluding University Park) for purposes of awarding this program. Institutional charges do not include charges for meal plans.

Taxation of Benefits


Faculty and staff are responsible for determining the tax effects of the tuition benefit in their individual circumstance.  The discussion below is to provide a general description of the possible taxation of benefits, but is not a legal interpretation of the applicable regulations.

Taxation of tuition benefit for courses below the graduate level:

Under IRS Code Section 117(d), a college or university may offer a tuition waiver to its current employees, former employees who retired or left on disability, widows or widowers of an individual who died while an employee, widows or widowers of a former employee who retired or left on disability, or dependent children or spouses of any of those individuals.  The value of the tuition benefit is excludable from the employee's gross income so long as the education for which the qualified tuition reduction is granted is below the graduate level.  If the benefit is applied to a child who is not a dependent as defined by IRS regulations the benefit will be taxable to the employee.  PLEASE NOTE: Effective August 2015, if a dependent fails to meet the IRS definition of a dependent, ACU will no longer award the tuition benefit.

Taxation of tuition benefit for graduate level courses:

Because IRS section 117(d) only excludes from income the value of a tuition discount received for undergraduate classes, ACU has chosen to participate in an Educational Assistance Plan adopted under IRS Code Section 127(b) (1).  The Educational Assistance plan applies to employees only (does not apply to spouses or dependents), and enables employees to exclude a specified amount of the tuition benefit from their taxable income for courses taken at the graduate level.

Employees

As of August 15, 2008, ACU has an Educational Assistance Plan that qualifies as a plan providing educational assistance to employees under IRS Code Section 127(b)(1). This plan enables employees to exclude from income up to $5,250 per calendar year (or such greater or lesser amount as may be subsequently permitted under the IRS Code Section 127) of the value of tuition benefit applied to courses at the graduate level. Consequently, employees who receive a tuition discount for graduate courses will not be taxed for up to $5,250 of this benefit.

Spouses and Dependents

In keeping with IRS requirements, this Educational Assistance Plan is not available to spouses or dependents of employees. ACU treats all benefits provided to spouses and dependents in a calendar year as paid in that same calendar year, and therefore, applicable taxes will be withheld in the same calendar year the benefit is received.  Social Security and federal income tax will be withheld on the benefit. Employees whose family members participate in graduate programs should be prepared for a reduced paycheck at the time the income is reported. PLEASE NOTE: Effective August 2015, ACU will no longer offer a graduate tuition benefit to spouses or dependents of ACU employees.

Procedure

An application must be completed once a year prior to the fall semester. This form may be submitted as early as March but must be submitted before or on the 12th day of class. Failure to do so will result in the loss of this benefit for the current semester.

*Faculty and staff hired before May 1, 1993, and continuously employed, are eligible for an 80% discount on tuition.