What is the maximum amount of interest earnings a school may retain from Title IV funds deposited into its account?

What is the maximum amount of interest earnings a school may retain from Title IV funds deposited into its account?

• A. Yes, up to $500 annually to cover administrative expenses
• B. Yes, up to the cost of maintaining the account
• C. No, a school may not retain any interest earnings
• D. Yes, unlimited interest earnings allowed

Answer: (A)

Interest earned on Title IV funds while they’re held by a school is allowed to be kept to help cover administrative costs, but there is a fixed cap. The maximum amount a school may retain is five hundred dollars per year. If the year’s interest is $500 or less, the school may keep it all. If it’s more than $500, the excess must be remitted to the U.S. Department of Education. This rule exists to offset the administrative work involved in handling Title IV funds. For example, if a year yields $700 in interest, the school keeps $500 and sends $200 to the Department.

Interest earned on Title IV funds while they’re held by a school is allowed to be kept to help cover administrative costs, but there is a fixed cap. The maximum amount a school may retain is five hundred dollars per year. If the year’s interest is $500 or less, the school may keep it all. If it’s more than $500, the excess must be remitted to the U.S. Department of Education. This rule exists to offset the administrative work involved in handling Title IV funds. For example, if a year yields $700 in interest, the school keeps $500 and sends $200 to the Department.