Student Resources from Income

To ensure equity in setting student resources from income, Harvard Law School expects that students seeking financial assistance will work a minimum of 8 full-time weeks during the summer and will save a substantial portion of their income, less taxes paid and a standard summer living allowance, to contribute toward their education expenses.  The work need not be paid or even necessarily in a legal field, but it must be verifiable (by a independent third party, i.e.  the employer), full-time and for the full 8 weeks. Students who take unpaid positions will need to provide documentation from their supervisors confirming the dates and hours worked. Self-employment is not verifiable by a independent third party and therefore, generally does not meet our work requirement. 

As mentioned above, HLS financial aid policy assumes that students will work for a minimum of 8 weeks in the summer. While most students either work as a summer associate in a private law firm or apply for funding from our Summer Public Interest Program to work in a public interest law job, we do not require you to do either of these. The only requirement is that you work in some capacity. You can volunteer, work for little pay or work in a non law-related job if circumstances require you do to so.

Since eligibility for HLS Grant assistance is directly related to the student resources from income, Student Financial Services will impute student resources for students who do not meet the 8-week work requirement. It would be unfair for a student to decide not to work and as a result receive a larger grant than a student who did work the required 8 weeks. Students who do not work due to a documented medical circumstance can appeal for a summer work waiver.

Work requirement and an imputed student resources from income will be calculated for the number of weeks not worked. Please see the section “Minimum Resources and Imputed Resources” below for more information. If you have any question about your summer employment, contact our office for clarification of our policy.

As stated above, we look at a maximum of 12 weeks of work. However, if you work more than one job and each job has a different rate of pay, we use the highest paying job first when determining the total gross income to use in the calculation of your student resources from income.

For example, let us say you work at one firm for 6 weeks and make $2,500/week (gross). You then work at another firm for 8 weeks and make $3,000/week (gross). You have worked a total of 14 weeks, but we will only use the top 12 weeks in the calculation of your contribution from income. The calculation of resources to use would be constructed as follows:

• 8 weeks x $3,000 = $24,000; plus
• 4 weeks x $2,500 = $10,000; equals
• 12 weeks worked with a total gross income of $34,000

While the Law School believes that instituting a policy of imputing a contribution for those who do not meet the work requirement is necessary to ensure fairness for everyone, we also recognize that there may be some situations that warrant an exception to this policy. If you are unable to work for either a medical reason or another compelling reason, we encourage you to speak to your Financial Aid Officer and/or submit information detailing your circumstances and request a summer work waiver through the Adjustment Form located within the SFS Self-Service Portal.

We will extend an exception to the summer work requirement to students in any degree-granting academic program that requires summer enrollment or summer academic work such as PhD dissertation research. To qualify for a waiver of the summer work requirement, a student must:

• Be enrolled in a degree-granting graduate program, either an approved joint degree or ad-hoc degree program, or a concurrent degree program, and
• Provide documentation
  • via an official school transcript, showing that the student was either enrolled for at least 8 weeks during the summer, or
  • via a statement from an academic adviser or other school official, verifying that the student performed at least 8 weeks of full-time academic-related research work during the summer

This exception will be granted for one JD summer only. For all students who do academic work for more than one summer, Student Financial Services will impute a student contribution at the rate for rising 3L students.

Individual classes or coursework completed for non-degree programs (i.e., language studies, independent research) do not qualify for the summer work requirement exception.

Any summer income from any source must be reported to Student Financial Services, even for students who request and receive a waiver of the summer work requirement.

These are the general categories of special programs to which this policy applies.

Students in these programs receive a reduced time to degree or the option to petition for a leave to attend another degree-granting institution.

Employment completed by a student during the academic year does not impact financial aid eligibility as it is considered self-help. However, if a student saves more than $3,000 from their employment instead of using it for expenses or reduce their overall borrowing, it should be reported as an asset increase. For more detailed information about academic year employment, visit this page here.

When considering student resources from the summer we include all income related to your summer. That is, all compensation, direct or indirect, of the sort that is included on a W-2 (wages, deferred compensation, housing, relocation, bonuses, vacation payouts, etc.).

Students applying for law school assistance should plan to allot a portion of their summer income towards their educational expenses for the upcoming academic year.

*We recommend using the Student Resources from Income calculator found within the SFS Self-Service Portal to estimate the above figures.

Note that most employers will typically withhold too much federal tax from a part-year salary, because withholding is typically based on the tax rate for an annualized projection of each pay period. You should ask to have less tax withheld if you will be working for only part of the year, such as the summer. IRS Publication 505 describes the procedure for adjusting withholding for part-year employees. It’s up to you to request this in writing from your employer, and it’s up to the employer to do the alternate calculation and charge the correct withholding.

Also note that the software package we use to assess financial resources makes tax approximations based on federal, state, and FICA tax tables that have been adopted for the academic year as need analysis standards by schools nationwide. Due to the complexity of federal and state tax codes and the timing and frequency of changes to various tax codes, in most cases these are a close but inexact approximation of what a particular individual may actually pay in taxes. The need analysis standards also adjust the allowance for state tax by state, so that the student resources of students with identical incomes but working in different states may vary according to the amount of state tax allowance used in the formula. It is important to understand that these adopted need analysis standards ensure that the student resource calculation for students with equivalent incomes and identical situations (such as primary summer employment state, marital status, size of family) is done in a uniform way throughout the academic year.

Federal Tax
Step One: Determine Standard Deduction (based on 2023 tax year deductions) and deduct from Gross Summer Income

• $13,850 Single
• $27,700 Married Filing Jointly
• $13,850 Married Filing Separately
• $20,800 Head of Household

Step Two: Estimated Federal Tax = typically 10% to 15% of remaining income, based on IRS tax table with higher percentages corresponding to higher income brackets

State Tax
Step One: Determine State Tax of State of Summer Employment
Step Two: Multiply Tax Rate by Gross Income

FICA Tax
Multiply total gross income earned by flat rate of 7.65%

Returning students (without dependent children) who have completed the minimum work requirement, but have held a low-paying job (as is the case with many public interest jobs) and do not have income which exceed the basic summer living allowance will not be expected to allocate anything from their summer income. Please note that all students will continue to have a calculation from student resources from assets regardless of summer income earned. For more information, please see Student Resources from Assets. Students with dependents should review the information on Students with Dependent Children and reach out to our office with any questions.

To determine how these rates will impact your Student Resources from Income, use your total summer gross income to determine the calculated Student Resources from Income (using the formula listed above). For entering students, that figure cannot be below the Minimum Resources listed. For returning students, take the calculated Student Resources from Income and then add the imputed rates below for the number of weeks not worked. We recommend reaching out to your Financial Aid Officer to ensure that you are determining the figure correctly and understand how it will impact your eligibility.

Summer Living Allowance

After analyzing actual summer expenses reported by students in the fall of the past academic year, the base summer living allowance (SLA) has been set at $9,000 by the Student Financial Services Committee. Please note that $9,000 is the base allowance for every student regardless of income level. For students working at firms or in higher paying positions, the SLA effectively increases with income. The examples below assume the following: a single person working in the Commonwealth of Massachusetts and a standard federal deduction of $13,850. For the sake of clarity, the figures are rounded.

Summer Car Rental Allowance

An additional allowance may be approved by the Financial Aid Committee for individual students with documented summer car rental expenses under the following conditions:

• The student must demonstrate that s/he worked for at least 8 weeks in an area without access to adequate public transportation (train, subway, bus) and that not having access to a rental car would have presented a serious impediment to his/her ability to work.
• The student must provide documentation of the car rental expenses showing the full amount paid by the student.
• Students should submit documentation of the expense during the Update Process in the Fall by submitting the Adjustment Form and all supporting documentation within the SFS Self-Service Portal.
• The rental car allowance is intended to cover only the cost of basic car rental during the work period. Gas, tolls, maintenance, and other car expenses are not covered by this allowance. The total car rental allowance for the summer is capped at $1,500.

Students who will be married during the school year are expected to report their spouse’s summer and academic year income (i.e., income from June 2024 — May 2025) as well as their own for the same periods. The Law School’s policy is to assume that the full income and resources of the spouse (or spouse-to-be) will be available to help meet both basic family living expenses and, if substantial enough, to help contribute towards the cost of the student’s legal education. For more information on the treatment of married students in our need analysis, please review the information on the page entitled Married Students and Students (Both Married Single) with Dependent Children.

While income from term-time employment is excluded from the calculation of your student resources, there are other types of income, benefits and financial resources that do have an impact. Examples of this type of income include pensions, social security and other government benefits.

Every year Student Financial Services conducts a Fall Financial Aid Update Review to update financial aid awards. All students are required to submit the Student Application Update form. The information provided on this form as well as any other required post-award documents are used to update our calculation of both your and your parents’ resources. This then allows us to update your financial aid eligibility and potential LIPP eligibility for the academic year. For more detailed information, please review Step 5 of the financial aid application process.

While many of our students see little to no change in their packages as a result of the Fall Update process, it is not uncommon for the package to change and the grant to either increase or decrease. The implications of such changes generally depend on the overall status of your full financial aid package prior to the Update process, particularly the following: 1) the accuracy of the total projected summer income (if married, this includes projection of your spouse’s income) versus the actual income, 2) whether or not your package is “at budget”, and 3) being able to confirm the enrollment of any siblings that were previously reported as “in school” via the Parent Application (this can have a significant impact on your financial aid package; for more information see “Assessed Parent Resources”). A package is considered to be “at budget” when the total value of current grants, awards, loans, etc. is equal to the total possible student budget. The key to understanding all the implications of the following scenarios is to recognize that federal and HLS regulations prohibit any student to be awarded a financial aid package in excess of their budget.

Grant Increase:

• If your grant eligibility increases as a result of the Fall Update process and there is NOT enough room in your student budget for the entire increase, then we must decrease some part of your package to award you the entire grant AND keep you within budget. In these cases, we examine your package as a whole and decrease the most expensive loan(s) first.
• If there is enough room in your budget to accommodate all of your increased grant, then the total amount of your package will go up. Any resulting credit on your student billing account will be refunded to you via cash advance in the form of a mailed check or, if you elect, via direct deposit to your bank account.

Grant Decrease:

• If your grant eligibility decreases as a result of the Fall Update process, a charge in the same amount of the decrease will show on your student billing account. This charge will be added to any already existing balance on your next Account Notice. You will either need to pay this amount in full by the due date listed or apply for additional loan assistance from a supplemental student loan.

Appeals

We recognize that even though awards are updated after the Fall Update process (described above), circumstances may change at any time during the year and a student’s award package may have to be adjusted up or down as the situation dictates. Both federal regulations and HLS aid policy require students to notify Student Financial Services of the following changes that may occur at any time during the academic year (June 1, 2024 through May 31, 2025).

Required: Students who have experienced any of the following MUST file a formal notification to SFS via the Adjustment Form within the SFS Self-Service Portal:

• Changes in your marital status (marriage, separation, divorce, etc.)
• Changes in your spouse’s employment
• Changes in your siblings’ school enrollment status
• New outside awards, fellowships, or scholarships not previously reported
• Increase in assets in excess of $3,000. For a list of assets requiring an update, see Types of Assets Considered.

In addition, there are special circumstances that merit a re-examination of a student’s award package. These usually include the following optional bases for a formal appeal. If you have questions about a situation not listed here, please contact your financial aid officer for guidance.

Optional: Students MAY submit a formal appeal via the Adjustment Form within the SFS Self-Service Portal in any of these situations if they would like a reconsideration of their eligibility:

• Change in student family size resulting from the birth or adoption of a child
• Out of pocket student medical/dental expenses
• Unexpected student travel expenses resulting from a family or other emergency
• High student living expenses
• Out of pocket parent medical/dental expenses
• Change in parent financial circumstances or employment
• Change in parent marital status

HLS’s financial aid program is among the most generous of any law school in the country. No other law school surpasses the financial support we offer lower-income students. And while the resources we can deploy are finite, we have continued to expand our financial aid program in recent years to further assist students with the greatest need. We also offer an unusually generous loan repayment assistance program, the Low Income Protection Plan (LIPP), so that graduates who forgo extremely high-paying law firm opportunities, often to pursue public service careers, receive assistance in paying off their law school loans, up to full payment.

Ensuring that we are always providing the most support to students with the highest need helps keep Harvard Law School affordable for the largest number of students. Summer earnings are a resource just as is any form of earnings. Students in high-paying summer jobs have, as a consequence, less need than students in lower-paying ones, including most of our incoming students. Our student resources from income policy accordingly provides more modest assistance to the former group, thereby shifting significant additional resources to the latter group. The bottom line is that this approach maximizes the grants that can be given to students with the very highest needs.