You can use your Segal AmeriCorps Education Award, Silver Scholar Education Award, or Summer of Service Education Award in any of the following ways—or a combination of them.

Repay Qualified Student Loans

The national service legislation defines qualified student loan as a loan backed by the federal government under Title IV of the Higher Education Act (except PLUS Loans to parents of students), or under Titles VII or VIII of the Public Health Service Act.

You may also use your Segal AmeriCorps Education Award to repay a student loan made to you by a state agency, including state institutions of higher education.

Segal AmeriCorps Education Awards may not be used to repay any other type of loan, even if the loan was obtained for educational purposes. You can use your Segal AmeriCorps Education Award to repay defaulted student loans as long as the loans meet the definition of qualified student loan.

Pay Current Educational Expenses at a Qualified School

Current educational expenses, as authorized under 42 U.S.C. § 12604(c), include:

• The "Cost of Attendance" for a degree- or certificate-granting program of study at a qualified school; and
• Educational expenses for non-degree courses offered by qualified schools, such as continuing education courses.

Your school is qualified if it is a Title IV institution of higher education.  This means that it participates in the US Department of Education’s Title IV Student Aid Programs. Students who attend the school are eligible for Federal student aid.

Current educational expenses are expenses that were incurred after you became an AmeriCorps member.

For degree or certificate programs of study, the cost of attendance (COA) may include tuition, books and supplies, transportation, room and board, and other expenses.  A school's financial aid office determines each student's COA based upon standard Federal legislation and guidance.

Pay Current Educational Expenses While Participating in an Approved School-to-Work Program

The "School-to-Work" program sunsetted in 2001 and is therefore not an available use for the education award.

HOW TO REQUEST PAYMENTS FROM YOUR AWARD ACOUNT

After you have completed your service and received notification of the availability of your award, you can begin to use your education award.  Go into your account in My AmeriCorps.  In your home page, under “My Education Award” click on the “Create Education Award Payment Request” link to bring up the screen to request the payment.  Follow the instructions and complete the form.  You will select the purpose of the payment (loan or current educational expenses), the amount of the payment, and identify the holder of your student loan.  When you click on “submit”, a notice will be sent electronically to your educational or loan institution.  A record of your request will appear in your account home page.

The school or loan holder will complete their portion of the form and return it electronically to the Corporation.  They will fill in the amount for which you are eligible if the request is for current educational expenses or they will provide the payoff amount and loan type if the request is for a student loan.  The institution will certify the accuracy of the information and submit it to the Corporation for payment.

When the payment has been made, your account will reflect the deduction.  It should also show up in the loan account statement that your loan company makes available to you.  If for some reason the institution denies the request for payment, they should have entered comments explaining the reason for the denial.

If your school or loan company has not registered in My AmeriCorps, they will not be on the list of institutions in the system.  After you do a search and your institution does not appear on the list, click on the “Not Found” link.  The next screen will ask you to enter as much information as you know about the school or loan company.  You will need to enter information in each of the asterisked fields and then submit the form.  These requests may be processed manually and can take several weeks to complete.

Financial Aid

Determining the amount of financial aid for which a student is eligible can be a complicated process.  The rules governing financial aid may contain terms that are hard to understand.  Financial Aid Officers are trained to keep up with the ever-changing rules and legislation affecting federal student aid. Your school’s Financial Aid Office can assist you in planning your financial aid over your college years.

Below we are providing some basic guidance in making the most of your education award during your educational experience.  We are also providing important information that you can pass on to Financial Aid Counselor which may help when he or she advises you on when and how to use your education award. 

If you intend to apply for student financial aid as well as use your education award, payments from your education award, interest payments on your student loans, and the living allowance you received during your service can affect your eligibility for some student aid in the school year after the payments were made.

• Under certain circumstances, your education award, living allowance, and Trust payments on accrued interest can be excluded from calculations determining your eligibility for student aid based on financial need.  This could increase the amount of "need-based" aid for which you are eligible.
• Under different circumstances, using the education award can reduce the amount of other need-based student aid for which you are eligible.

Many schools will require you to fill out the Free Application for Federal Student Aid (commonly known as FAFSA) if you use your education award, even if you do not intend to apply for financial aid.  The FAFSA can be completed online.  If you are required to complete this form, complete it early and correctly.  A section of the form asks about your income from the previous year.  If you used your education award in the previous year, had interest payments made by AmeriCorps, or received a living allowance, be sure to include those amounts on the line where it asks for “AmeriCorps benefits (awards, living allowances and interest payments)”.

Information You Can Give to Your Financial Aid Counselor

Dear Financial Aid Officer:

We are providing this information to assist you in understanding the relationships between AmeriCorps and FAFSA.  An AmeriCorps member receives three types of benefits that are relevant to completing the FAFSA:

Living Allowance: AmeriCorps members may receive a living allowance to cover living expenses during their term of service.

Segal AmeriCorps Education Award: After successfully completing a term of service, AmeriCorps members who are enrolled in the National Service Trust are eligible to receive an education award.  The education award can be used to pay education costs at qualified institutions of higher education or training, or to repay qualified student loans.  Members can use any portion of their education award and a member has up to seven years after his or her term of service has ended to claim the award.

Payment of interest on loans: The Corporation for National and Community Service pays interest on postponed qualified student loans for AmeriCorps members who successfully complete their term of service.

The member may also be earning Federal Work-Study wages for serving in an AmeriCorps project. All of these benefits should be included on the "income exclusion worksheet" of the FAFSA.

With respect to the education award and interest payment, the IRS has determined that these payments are subject to income taxes in the calendar years in which the payments are made.  That taxable amount is reported on a 1099 form.  When the student files a FAFSA for the following year, the amount of the Segal AmeriCorps Education Award paid in the base year and included in that year's AGI, is to be excluded from the need analysis calculation.  In most cases, the entire education award amount that was paid is taxable, so the entire amount that was paid is included in the AGI.  Thus the filer is to report the entire amount that was paid, not just the amount in excess of tuition, fees, books, and supplies.

When students use their education awards as a resource, it may reduce their eligibility for campus-based aid. Financial aid offices must consider the Segal AmeriCorps Education Award as a resource, or funds that you have available toward your cost of attendance, when considering your eligibility for campus-based aid.  This includes the Federal Supplemental Educational Opportunity Grant (SEOG), the Federal Work-Study Program, and Perkins Loans. (See 34 C.F.R. § 673.5(c).)

AmeriCorps VISTA members have some additional benefits.  Whether they have elected the education award or the stipend, AmeriCorps VISTA members may be eligible for other types of loan postponements.  Those who choose the stipend are also uniquely eligible for partial cancellation of Perkins loans.