The 1998 Reauthorization of the Higher Education Act requires the college to calculate a Return of Title IV Funds on all federal financial aid students who withdraw (officially or unofficially) from all classes on or before the 60% attendance point of the semester. A pro-rata schedule is used to determine the percentage of the semester the student attended based on the withdrawal date/last date of attendance.

The student's withdrawal date is the date the student began the withdrawal process; the date the student otherwise provided the school with official notification of the intent to withdraw; or for the student who does not begin the school's withdrawal process or notify the school of intent to withdraw, the mid-point of the payment period of enrollment for which the Title IV assistance was disbursed (unless the institution can document a later date).

The percentage of the semester the student attended is calculated as follows:

Number of days in attendance

The number of days counted includes all calendar days in the semester including weekends and holidays, but excludes college breaks of five or more days.

The percentage of the semester the student attended is used to calculate the amount of the student's earned versus unearned federal aid funds. The unearned portion of federal aid funds must be returned to the appropriate aid program in accordance with the Order of Return as mandated by law. The Order of Return is: Federal Unsubsidized Loan, Federal Subsidized Loan, Federal PLUS Loan, Federal Pell Grant, Federal SEOG Grant, Other Title IV Aid.

The college is responsible for returning the lesser of Unearned Title IV Aid or Unearned Institutional Charges. Unearned Institutional Charges are based on the determined percentage of the semester the student did not attend. The College is responsible for its return of funds first, followed by the student's return of funds.

The College must return its portion of Unearned Title IV aid (loan and grant) to the appropriate federal program within 30 days from the student's withdrawal date as determined by the Office of Financial Aid. If the amount the student returns includes a federal loan, the student is responsible for repayment of the loan in accordance with the terms of the loan program. If the amount the student returns includes grant aid, the student must repay 50% of the grant money received, rather than 100%.

The student must return unearned grant aid to the college within 45 days from the date of notification. Failure by the student to return or make arrangements to return unearned grant aid to the College within 45 days will result in the student being reported to the U.S. Department of Education (USDOE). The student will be considered in an Overpayment Status, and will not be eligible for additional aid at any post-secondary institution participating in Title IV Aid programs. Students who are reported to USDOE in an Overpayment Status should contact the USDOE to make payment arrangements to repay the necessary grant funds.

Examples of Federal Title IV Return of Funds calculation are available in the Office of Financial Aid. Students who stop attending Lycoming College may not receive further financial aid disbursements, may lose some or all of the aid that has already been disbursed to their account, may be responsible for repayment of unpaid charges, and may be considered in Overpayment status with USDOE.

Students who wish to rescind their official withdrawal submitted to the college must do so within one week of the original withdrawal and notification must be provided in writing to the Office of Financial Aid.

Students who stop attending all classes without officially withdrawing from the college will be subject to a Return of Funds calculation at the end of the semester, based on their last date of attendance as determined by the Office of Financial Aid.

State Grant programs have varying regulations concerning refunds, but most will required at least a partial refund of the State Grant. If the student has received a Lycoming Grant, a portion of the student's refund also will be repaid to the Lycoming Grant program. This will reduce, or in many cases eliminate, the amount of the refund the student otherwise would receive.