Key differences between the two end-of-service benefits:
|
|
Education Award |
End of Service Stipend |
|
How much money is it? |
· $5,350 for a year of full-time service.* |
· $1,500 cash stipend, disbursed to you in your last two living allowance payments. |
|
Can I switch between options? |
· If you choose the education award, you can switch to the end-of-service stipend prior to your 10th month of service. |
· You may NOT switch to the education award from the stipend. |
|
How can it be used? |
· It can be used to pay tuition at a Title IV institution of higher education, for educational training, or to repay your qualified student loans. |
· It is not limited in how you use it. |
|
Are taxes taken out? |
· $5,350 is the pretax amount - you will have to pay taxes on the education award in the tax year(s) you use it.** |
· Federal and FICA taxes are deducted when the payment is made. |
|
Can my student loans be put in forbearance? |
· If you've selected the education award,you can request forbearance. However, it is up to the loan holder to grant forbearance. |
· You may be eligible for loan deferment based on economic hardship. You may also be eligible for cancellation of part of your Federal Perkins Loan after completion of a full year of VISTA. |
|
What do I get if I have to end my term of service early? |
· In rare circumstances, you may be able to get a pro-rated education award if you leave before the end of your service but ONLY if you left for a compelling reason. |
· In rare circumstances, you may be able to get a pro-rated stipend if you leave before the end of your service but ONLY if you left for a compelling reason. |
|
Can I spend it while I’m serving? |
· You cannot use it while you are serving as a VISTA. |
· You cannot use it while you are serving as a VISTA. |
|
How long do I have to use it? |
· You can access part or all of the award up to seven years after you complete your service. |
· There is no time limit on using the stipend. |
|
Can I give it to someone else? |
It is not transferable to anyone else. · |
The Stipend is yours to use however you see fit. · |
* Beginning on October 1, 2009, the Segal AmeriCorps Education Award will be equal to the amount of the Pell grant. Visit the site below for additional information: http://www.americorps.gov/for_individuals/benefits/benefits_ed_award_details.asp
** The Segal AmeriCorps Education Award is subject to federal tax in the year the payment is made.
If the Trust makes a payment on qualified student loans to a school or lender for the entire amount of a full-time education award in one calendar year, the member is responsible for any income taxes owed in that calendar year on the entire amount. If a member redeems only a portion of their education award in one calendar year, s/he is responsible for any taxes owed on that portion. Interest that is paid on qualified student loans is also subject to income taxes in the year it was paid.
Tax is not deducted from a member’s education award or interest payments. If the education award and interest payments total more than $600 in a calendar year, members will receive a Form 1099 to be used in filing their income tax return. The total sum of interest payments and the Segal AmeriCorps Education Award are listed together on the 1099 form.
See also:
If I choose the Stipend, when will I receive my money?
What is the Partial Perkins Loan Cancellation
Can I change from the Segal AmeriCorps Education Award to the stipend?