Student Loan Repayment Assistance Frequently Asked Questions

Student loan repayment assistance is one of the fastest growing employee benefits. It addresses the burden student loan debt places on today’s workforce and helps employers compete for top talent.

This student loan repayment assistance program has multiple forms.

• Student loan paydown allows employers to make payments toward their employees’ student loans. These payments reduce the total student loan amount paid, interest expense, and time it takes to pay off the debt. Annual employer contributions to an employee’s student loans of up to $5,250 are income tax-free for the employee and payroll tax-free for the employer through Dec. 31, 2025, when provided as part of an Educational Assistance Program.
• Track student loan payments to support a matching contribution to a retirement or 401(k) account. Under the SECURE Act 2.0, employers are allowed to treat employees’ payments toward qualified student loan debt as if they were 401(k) contributions for matching purposes. Prior to SECURE Act 2.0, employees often missed out on employer match opportunities because they had to repay their student loans rather than fund their retirement accounts.

Tuition reimbursement assists employees who are currently enrolled in school. Employers reimburse employees for tuition and expenses they are paying. A student loan paydown supports employees that have taken out student loans to cover education expenses. Both tuition reimbursement and student loan paydown are income tax-free when offered through an eligible Educational Assistance Program.

All student loans (private and federal) that were obtained to pay for specific higher education expenses for an employee can be eligible for a student loan paydown benefit. This includes education loans that covered tuition, fees, room, and board, books, supplies and other necessary expenses. Loans taken out for the education of non-employees, such as a Parent PLUS loan, are not eligible for the tax incentives, but if an employer chooses to, they can make payments on those loans as well.

An employer contribution is an employer-funded payment made directly to an employee’s student loan. It is not a payroll deduction. It is not a bonus. The amount varies per employer and can be determined at the employee level. The most common monthly contribution is $100 per employee participant. Check out our Matrix of Companies’ Student Loan Repayment Assistance Offerings for an overview of other companies’ contributions.

Yes, it’s easy to add a student loan paydown contribution to an existing Educational Assistance Program. Section 127 of the IRS Tax Code outlines the criteria. The annual tax-free amount of $5,250 can be split between tuition reimbursement and SLRA. An employer’s contribution must be provided as part of a qualified Educational Assistance Program to be eligible for the tax-free status.

Let your HR team know you are interested in the benefit. Here is some information you can share.

Employers can use student loan repayment assistance to attract candidates to certain positions, improve retention, and increase productivity. It helps ease the financial and emotional stress of managing debt and can align directly with your organization’s goals. For more information, check out our infographic to find out why student loan repayment assistance is the third most in-demand benefit among employees right now.

Employer payments go directly to an employee’s student loan, which in turn helps them pay down their loans faster and gets them out of debt sooner. Student loan repayment assistance can also result in a reduction in workplace stress, a boost in productivity, and increased morale. It gives the opportunity for employees to achieve their financial goals which may not have been possible before. Check out The Yin and Yang of Student Loan Debt and Employee Benefits for more insights.

Offering high-demand benefits, such as student loan repayment assistance, increases your chances of retaining and attracting top talent. 80% of millennials stated they would strongly consider a job with a student loan repayment benefit over one without it. Student loan repayment assistance produces a high ROI by easily and quickly paying for itself, since it helps reduce turnover rates and therefore reduces all costs associated. Our ROI calculator can give you a personalized calculation on what your return on investment with student loan repayment assistance can look like for your company.

The CARES Act expanded the scope of Sec. 127 of the Internal Revenue Code which addresses employer-paid tuition benefits. The CARES Act stipulated $5,250 for employers to annually contribute tax-free to tuition assistance and student loan paydown. An employer can pay for all or part of an employee’s qualified education loan as a tax-free benefit, provided that benefit is part of an employer’s Educational Assistance Program. The $5,250 cap is now the combined annual limit for education assistance payments.

On average, we see contributions per employee range from $50-$450 per month. These amounts can also be adjusted for different groups and criteria such as position, seniority, or a custom set of requirements. You can always start small and adjust the amount over time as well. $100 per month seems to be the most common amount.

There is no limit to the amount an employer can contribute towards an employee’s student loans. Education benefit payments up to $5,250 are tax-free for the employee and payroll tax-free for the employer (through Dec. 31, 2025) when offered as part of an Educational Assistance Program. However, employers can contribute beyond the threshold. Employers should consult with their tax advisor to determine how the overage would be handled.

The SECURE Act 2.0 lets employers treat employees’ payments toward student loan debt as if they were a deferred contribution for matching purposes. Prior to this change, people often missed out on employer match opportunities because they had to repay their student loans rather than fund their retirement accounts. Specifically, under the SECURE Act 2.0, matching contributions to employees' retirement account can be based on qualified student loan payments.

Work with your policy provider. They will assist you by adding this information based off the current legislation. An employer must have student loan contributions outlined in their retirement plan to make contribution payments towards an employee’s retirement account.

To receive this new type of matching contribution, eligible employees must certify that eligible loan payments have been made on an annual basis. A platform like Co-Pay Partners can track payment history and obtain certification from the employee.

It depends on the employer policy. Employees may be making payments on their dependents or spouse’s student loans. Pending further guidance, spouse and dependent student loans can be included in an employer policy, where the employer would consider those payments eligible for matching contributions.

1. Start by clarifying your company's talent goals and how student loan repayment assistance aligns with your overall talent acquisition and retention strategy.
2. Analyze your workforce to determine the number of employees who have student loans and might benefit.
3. Decide on your contribution amount and frequency.

In the end this benefit, like others you offer, requires a financial investment in line with the return you seek.

If you already have an Educational Assistance Program, it’s easy to add student loan repayment assistance into your existing policy. If not, we have resources to help you get started. We first suggest talking internally about your goals and how you would like to structure your Educational Assistance Program.

Yes, we provide a platform to help employers administer a student loan repayment assistance program.

• Student loan paydown. Make direct contributions to your employees’ student loans.
• Student loan match. Track payments and capture certification to support a matching contribution to your employee's retirement account.

You can contact us to request more information or set up a meeting with one of our experts. We’ve also created the Employer’s Guide to Student Loan Repayment Assistance which shares insight, templates, and step-by-step instructions on how to implement a student loan repayment assistance program.

Yes, the platform is fully customizable to what works best for your organization and can be changed if needed. During the set-up process, we work with you to determine the payment amounts and frequencies that best suit your company. The platform supports tiered payments, set amounts, one-time payments, and more.

Throughout the process, we work with you to gather and complete all necessary information to make onboarding as easy as possible. Upon contract execution, we meet with you to discuss the next steps and go over the set-up form. The form gathers simple information such as company name, logo, and demographic information. Once the form has been received, we create your account in Co-Pay Partners. When it is ready to go, we send you an invitation to enroll as an administrator. Our onboarding team will provide an overview of the platform and its functions to ensure a smooth experience. The final step is to register your employees.

Typically, the process takes less than 30 days. Upon contract execution, we work with you on your account set up and your first student loan repayment assistance payment could be sent as soon as the following month.

Our support team works closely with you, your team, and your employee’s student loan servicer. From day one we are here to help with questions or needs that come up. We understand student loans can be complicated and are here to take the guesswork out of the process.

For federal student loans, they can go to the Department of Education’s website. If your employees have private loans checking their credit report to see the lender’s name or following up with their college could help them gather more information. During enrollment if they have any questions, we are happy to assist them.

No, you can have as few as 1 employee all the way to 10,000 or more, we support businesses of all shapes and sizes. To find out more about our pricing, please contact us.

Yes! We offer a communications toolkit which provides email templates, article posts, and digital ads for you to add to your intranet and link your HR policy to use when onboarding and introducing the benefit and more.

Employees will need to provide a statement from their student loan servicer from within the last 90 days, and potentially link their student loan account to Co-Pay Partners. This is a simple process that allows us to ensure the loan is for the employee and payments are made to the correct location.

Student loan repayment assistance payments don’t replace the employee’s monthly payment. Employees are encouraged to keep making payments alongside any employer contributions to help reduce their overall student loan debt.

We would be happy to meet with you to answer any questions you may have and provide a demo. Use this Contact Us form to provide your contact information and preferred time to meet.

A SOC report is a document that provides assurance about the internal controls of a vendor that affect the security, availability, processing integrity, confidentiality or privacy of their system or the data they process or store.

Requesting a SOC report from your vendor can help you to:

• Evaluate the vendor’s ability to meet your expectations and requirements regarding their service or product.
• Assess the risks and potential impact of outsourcing a function or process to the vendor on your own operations and objectives.
• Verify that the vendor has implemented and maintained effective controls to protect your data and system from unauthorized access, misuse, errors or fraud.
• Comply with your own internal policies, regulations or standards that require you to monitor and review your vendors’ performance and controls.
• Demonstrate to your stakeholders, customers, auditors or regulators that you have taken appropriate steps to ensure the quality and reliability of the services or products you receive from your vendors.

Co-Pay Partners is an information system-based service to administer an SLRA program. Co-Pay Partners is SOC3 Type II compliant. Reports are available upon request.

Co-Pay Partners' support team is available for all the what-ifs. We take great pride in our customer service and will step in to resolve any issues that may arise in the payment application process.

We have a strong commitment to security and to delivering high-quality services to our clients by demonstrating they have the necessary internal controls and processes in place. The Co-Pay Partner’s platform is fully encrypted, and SOC 2 approved. We take our customers security seriously and make sure we abide by all compliance standards.

The Co-Pay Partner’s solution is part of the Attigo Suite, created to help people reach their full potential. Our products support academic achievement, long-term financial wellness, and student loan repayment success. Attigo is provided by Ascendium Education Solutions, an affiliate of Ascendium Education Group. For over 55, years we’ve simplified the complex and provided expert insight and counseling. As the nation’s largest student loan guarantor, our knowledge of federal student loan regulations, policies and servicing has helped millions of people achieve repayment success. We’re a nonprofit organization whose philanthropic mission is to elevate opportunities and outcomes for learners from low-income backgrounds.

Our suite of solutions can be used individually or in tandem to tackle every aspect of student loan distress. We can turn overwhelmed employees into empowered leaders with our student loan repayment support for employees that includes online financial education, personalized counseling, and a sophisticated tool to help people manage the highly complex student loans.

We also offer free monthly SmartSessions webinars, or by request training for your team.

In the best interest of student loan borrowers, we don’t offer loan refinancing. When refinancing through a private lender, borrowers could lose out on some of the benefits federal loans offer. It takes a fine balance of what can be right for each student loan borrower. As a nonprofit organization, instead of offering refinancing, we offer support. We have experts that can address your employee’s questions with in-depth knowledge into the best solution.

Use our Contact Us form and let us know you are interested in offering Student Loan Repayment Assistance. We would be honored to work with you and support your employees with this benefit.