Financial Aid: Processing Payments to Graduate and Professional Students
Payments (also called stipends in this policy) to graduate and professional students are made through the Student Financial Aid Office unless the payments are related to providing services as an employee or are to reimburse non-educational expenses, such as travel. This policy defines and clarifies terms and payment processes. See 2:080 Processing Payments to Undergraduates, Graduates, and Professional Students for payments to undergraduate students.
Because the word stipend is used so often and can have so many different meanings it will be defined as follows for this policy – a payment or payments made to a student because they were selected:
- For an award based on academic merit;
- For an award based on financial need;
- For an award based on talent such as music, athletic ability, or the like;
- For an award based on any combination of academic and/or financial need and/or talent;
- To provide service to the University as an employee.
This policy defines and clarifies the following terms:
The definition of a payment must look to the substance of the transaction, not what the payment may be labeled. For example, the Jane Smith Award and the Peter Jones Prize may actually be a student employment opportunity and a scholarship, respectively. There is often confusion about the exact nature of a payment because the terms used are not based on a precise description and understanding of the payment. Payments/stipends should be processed as described below.
Payments to graduate and professional students are processed according to this schedule:
|Scenario||Financial Aid||Service Rendered||Student Financial Aid||Payroll Office||Accounting Services|
Student Accounts Receivable System
Financial aid payments flow through the student accounts receivable system (CSAR), where they are applied to any balance a student owes the University from educational fees, incidental fees, housing and other costs incurred on their accounts, such as from the Bookstore, Parking, etc. Any amounts over and above what the student owes will result in a payment of the excess to the student. The payments are by check unless the student requests direct deposit.
The timing of entering fee waivers into the CSAR system is critical. If a student has a balance due in CSAR, any financial aid processed is applied first to the balance due. Therefore, departments must ensure the timely notification of the Graduate School so that the fee waivers are entered into CSAR if the intent is to generate a payment in a timely fashion to the student.
Timing of Payments
Each semester, the earliest that financial aid payments are made into the CSAR system is 10 calendar days before the first day of class. Departments/programs have the option to schedule financial aid payments once a semester or monthly. For further information, contact the Student Financial Aid Office.
For first-time MU graduate students only, departments/programs have the option to request a full or partial payment of certain departmental/program financial aid expected for the initial academic term of attendance at MU. The student does not have to be academically or financially enrolled to receive this first payment.
Payments for services are considered compensation, subject to appropriate deductions and taxes, and reported on IRS form W-2.
As required by the Taxpayer Relief Act of 1997, financial aid and qualified educational expenses are reported to the student on IRS form 1098-T for calculation of the Hope and Lifetime Tax Credits. It is the taxpayer’s responsibility to determine what portion of financial aid is taxable and properly report it on their income tax return.