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History of the SegalAmeriCorps Education Award
• AmeriCorps was created under President Clinton in 1994.
• AmeriCorps Education Award was named after Eli Segal, first CEO of the Corporation for National and Community Service.
• The National Service Trust– Account in the U.S. Treasury that pays for AmeriCorps Education
Awards.– Also pays interest that accrues on qualified student loans for
AmeriCorps members over their service year.
Segal Education AwardTerm of Service
Minimum Number of
Service Hours
AmeriCorps Education
Award
Full-Time 1700 $5,730
Half-Time 900 $2,865
Reduced Half-Time
675 $2,182.78
Quarter-Time 450 $1,515.55
Minimum Time 300 $1,212.44
Online system for distributing AmeriCorps Education Awards.
Access your education award online at:
My AmeriCorps Portal
https://my.americorps.gov
Education Award Rules
Payments are made directly to the loan holder or school – not to you.
You have 7 years to use your award.• Can request grant extension
on my americorps
You can only receive the equivalent value amount of 2 FT Ed awards
You can use it all at once OR divide it up and use portions at different times
Education Award payments are considered taxable income.Education awards can be transferred to family members if member was at least 55 years of age at the start of their service year.
Uses
1Repay
qualified student loans
2 Current
educational expenses at
eligible schools
“current ed expenses”= expenses incurred after officially becoming an AC member (cannot use to pay school debt)
http://www.nationalservice.gov/programs/americorps/segal-americorps-education-award/using-your-segal-education-award
Repay Student Loans
Eligible•Qualified Student Loan: a loan backed by the federal government under Title IV of the Higher Education Act or under Titles VII or VIII of the Public Health Service Act.•Loan made to you by a state agency, including state institutions of higher education.•Can be used for defaulted loans, as long as qualified
EX: Stafford, Perkins, William D. Ford Direct, Federal Consolidated, Supplemental Loans for Students, Primary Care Loans, Nursing Student Loans, Health Education Assistance
Ineligible•Private loans (i.e. student loan from credit union)•Parent PLUS loans (if name is not on loan CNCS is not able to disburse payment)
How to know if private? Contact servicer to ask.
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Repayment Choices
When you make a lump sum payment on your federal student loan(s), there are two ways that payments can get applied to your account:
http://www.nationalservice.gov/resources/ed-award/whos-jade
Paying Down PrinciplePaying off early
• Pay less over life of loan• Lower monthly payment
amount
Advancing PaymentPaying ahead
• Pay ahead as many loan payments as Ed award will cover
• Get a break from making student loan payments.
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Student Loan Forbearance
Interest Accrual Payments• National Trust will pay the interest that accumulated on
your student loan – Up to 100%, depending on type (full/part time) and length of service
• After you finish your term, go back to your “My AmeriCorps Portal” & click the Interest Accrual Request link.
• Fill in the name of the lending school or institution, city, state, & zip. Repeat for multiple loans.
• Within a few weeks, CNCS will send funds to your lender.
http://www.nationalservice.gov/programs/americorps/segal-americorps-education-award/using-your-segal-education-award/postponing
*NOTE*At the end of forbearance (once your service term is done) interest that accrued will be added to your outstanding principle.If you wait to submit request to have the interest paid off, each month interest will be accrued on your new (larger) principle amount.Thus the sooner you submit the request, the better.
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Public Service Loan Forgiveness
• Must have federal direct loans, if not you can consolidate – Combining multiple federal loans into one loan= single monthly payment as opposed
to multiple.– You may want to consider consolidation if you can get a better interest rate.– Make sure the “new” consolidated loan is a qualified student loan (loans backed by
the federal government).– RESEARCH IT WELL. Only enter into after careful consideration.– Cannot consolidate private loans into federal.
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https://studentaid.ed.gov/sa/repay-loans/forgiveness-cancellation/public-service
• This program offers forgiveness for outstanding Federal Direct loans for those individuals who make 120 qualifying payments (10 years), while working full-time in a “public service job”. - For government or non-profit- Does not have to be consecutive payments!- Years in AC may count towards payments
https://studentaid.ed.gov/sa/repay-loans/consolidation#eligible-loans
Income-Based Repayment Plan
• This plan helps to make repaying student loans more affordable for low-income borrowers.
• Reduces monthly loan payments according to your income.
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PSLF & IBR• IBR: paying less per month, can take longer to pay off debt,
thus more accumulated unpaid interest. • IBR + PSLF: But, if you are eligible for IBR and PSLF, your
remaining loan balance, including any accumulated interest, could be wiped away.
• During AmeriCorps– If you are single & make $12,100 during your AmeriCorps
service year, your monthly payments could be as low as $0 per month according to IBR.
– The $0 per month payment on a qualifying loan counts towards the required 120 payments for PSLF.
– An IBR calculator is available at www.finaid.org to estimate your monthly payment.
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http://www.nationalservice.gov/resources/ed-award/trent-triumphs-over-debt
Current Education Expenses
Eligible Schools•"Title IV schools." This category includes most post-secondary colleges, universities, and technical schools.•G.I. Bill approved courses or training programs
Award can be used for:•Cost of Attendance (COA) for degree/ certificate granting program
• tuition, books and supplies for classes, transportation, room and board, etc.
•Education expenses for non-degree courses (i.e. workshops, job trainings, apprenticeships through Title IV schools)
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http://www.nationalservice.gov/resources/ed-award/ayesha-explores-her-options
Financial Aid Basics
Cost of Attendance (COA): The amount it costs to attend a college or university. Includes tuition/fees, room and board, books, supplies, transportation. It may also cover the purchase of a computer.
Expected Family Contribution (EFC): The amount you and your family (if your parents claim you on their taxes) are expected to contribute towards the cost of your education. This is based on income and assets from the previous tax year.
COA – EFC = NEED
Need: The difference between the COA and the EFC is the student’s financial need
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www.finaid.org
FAFSA: Free Application for Federal Student Aid
Add your AmeriCorps-related earnings to the “Additional Financial Information” section on your FAFSA where it asks for “AmeriCorps benefits”
2
Reporting your AmeriCorps living allowance, educationaward and interest accrual payments on the “Additional Financial Information” section will adjust your gross annual income/your EFC.
For example, if your onlysource of income was your$12,100 AmeriCorps livingallowance, then for financialaid purposes your income may be considered as $0, which could increase the amount of “need-based” aid you are eligible for.
12,000- 0 = 12,000
If you used your Ed award the previous year but put that in the general “income” section on the form, along with your living stipend, that could decrease the amount of aid you are eligible for.
12,000 – 5,730 = 6,270
Greater Need
Less Need
COA – EFC = NEED
COA – EFC = NEED
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Examples
AVOID LOSING AIDBeware of OVER-AWARD STATUS!
Financial aid cannot exceed the COAIf, after you receive financial aid, you
decide to use your Ed award, the financial aid office may reduce your
aid package.
COA= $12,000 Financial aid received= $9,050
COA= $12,000 Financial aid $9,050 + Ed award $5,730 = $14,780
Consult the school’s financial aid department. They can explore with you if it’s best to use the award for tuition or use financial aid (if eligible) and save the award for outstanding loans.
2
Taxes
• Your living stipend, education award, and interest accrual payment are all counted as taxable income.
• Be aware, if you use your Ed award all at once, that will be more income on your tax form thus more taxes to pay.
• If spread use over multiple years, your tax obligation is also spread
http://www.nationalservice.gov/programs/americorps/segal-americorps-education-award/using-your-segal-education-award/tax
If you use a total of $600 or more of interest accrual award or Ed award, CNCS will send you a 1099 MISC
Still confused? Call the National Service Hotline
1-800-942-2677
9:00 am to 7:00 pm Mon-Thursday + some Fridays
Check out the FAQ documenthttp://www.nationalservice.gov/documents/education-award-faqs