Scholarships for Children of Employees: A Comprehensive Guide

With the ever-increasing cost of higher education, scholarships for children of employees have become a significant way for employers to support their workforce. This article explores the landscape of these scholarships, providing insights into eligibility, tax implications, and notable company programs.

The Rising Importance of Employee Dependent Scholarships

As college tuitions continue to rise, employers are increasingly viewing scholarships for children of employees as a valuable benefit. By offering such programs, companies not only assist their employees financially but also contribute to the education and future employability of the next generation. Improving youth employability is one of the key imperatives.

IRS Guidelines for Employer-Related Scholarship Programs

Employers may be dissuaded from establishing such scholarships because the scholarships would be included in the parent employee’s compensation. In fact, there is a way for an employer to finance scholarships for children of employees without having the scholarships included in the income of employees. Just having a third party administer a program for scholarships for children of employees of a donor employer does not in itself insulate the employees from having the scholarships included in their compensation. In Rev. Proc. 76-47, as later amplified and modified, the IRS provides guidelines which would allow grants from a scholarship program for children of employees not to be considered compensation of the employees.

The IRS provides specific guidelines in Rev. Proc. 76-47, which allows grants from a scholarship program for children of employees not to be considered compensation of the employees. These guidelines are designed to ensure that the scholarships are primarily for furthering education rather than compensating employees.

Key IRS Guidelines:

Independent Selection Committee: A selection committee must consist wholly of individuals totally independent of the employer. Former employees are not considered totally independent.

By adhering to these guidelines, companies can ensure that their scholarship programs are compliant with tax regulations and that the scholarships are not considered taxable income for the employees.

Read also: Camp Scholarships Guide

Eligibility Requirements and Application Process

The eligibility requirements for each of these scholarships will loosely follow those same rules, but should be examined in more depth to determine if you are eligible. As long as you’re a dependent under the age of twenty six, Milken and Company wants to help you fund your education. Students who plan to attend college or vocational-technical/ polytechnic programs.

The eligibility requirements for each of these scholarships can vary, it is important to carefully read through the eligibility requirements of each scholarship.

General Eligibility Criteria:

Dependent Status: The applicant is generally defined as a child/step-child under the age of 19. Full-time students under the age of 24 are also considered dependents. As long as you’re a dependent under the age of twenty six.
Enrollment Status: Students who plan to attend college or vocational-technical/ polytechnic programs. two or four year college, university, or vocational-technical school full time.
Employment of Parent/Guardian: The applicant must be a dependent of someone who fits that criteria at the time of your application.

Application Process:

Give yourself plenty of time to apply, as there are multiple components to some of the scholarships, including recommendations.

Thorough Review: Carefully read through the eligibility requirements of each scholarship.
Timely Submission: Give yourself plenty of time to apply, as there are multiple components to some of the scholarships, including recommendations.
Required Documents: Copies of your most recent transcript/s and fall grades based on your current educational circumstances (high school student, continuing college student, graduate student). A copy of your/your sponsor’s form SF-50 (Notice of Personnel Action). If you are sponsored by a retired NARFE or AFGE member or by a non-federal BIG member, you are not required to provide an SF-50/PS-50.

SF-50 Form:

Because FEEA’s scholarship program is only open to federal civilian and postal workers and their families, each applicant must either be a federal employee or have a parent/guardian or spouse who is a fed. A copy of your/your sponsor’s form SF-50 (Notice of Personnel Action). If you are sponsored by a retired NARFE or AFGE member or by a non-federal BIG member, you are not required to provide an SF-50/PS-50.

What is an “employee sponsor” and why do you need an SF-50 or PS-50? Because FEEA’s scholarship program is only open to federal civilian and postal workers and their families, each applicant must either be a federal employee or have a parent/guardian or spouse who is a fed.
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Notable Company Scholarship Programs

The list of companies above is by far not exhaustive. Lots of companies have scholarships and programs like those above. If your parents work somewhere, be sure to inquire about if they have a program. It never hurts to ask!

Read also: Benefits of NSHSS Scholarships

Many companies offer scholarships for their employees’ dependents. These programs can provide significant financial assistance for undergraduate programs, technical schools, and even graduate studies.

HII Scholarship Fund: At HII, we believe education is the foundation for a brighter future. Since 2016, the HII Scholarship Fund has awarded millions in scholarships to the children of our employees. The first steps in learning can shape a lifetime of possibilities. That’s why the HII Scholarship Fund helps HII employees give their children the strongest start-with scholarships of up to $3,000 for pre-K education. College is a big investment-and we want to help make it easier for HII families. The HII Scholarship Fund offers up to $3,000 for students enrolled in four-year programs and $1,500 for two-year programs. Since 2016, the HII Scholarship Fund has helped hundreds of dependent children of HII employees pursue their dreams-whether that’s college, technical training, or even pre-K readiness. Today, those same children are thriving in their careers and communities.
Siemens: Siemens offers scholarships to employees dependents that are renewable for up to four years ( $4,000 when renewed for four years).
Intel: Intel offers the Andy Grove Scholarship opportunity to students all over the world. Students who are children of blue-badge Intel employees may be enrolled at vocational or technical schools as well as colleges and universities.
Fred and Lena Meijer scholarship: The Fred and Lena Meijer scholarship awards multiple scholarships between $5,000 and $10,000 to Meijer employees and their children.
CVS: CVS does more than just offer tuition reimbursement programs for employees-they also want to see their employees’ children succeed! The company bases their scholarship award amounts on the tuition of the school students attend and their level of financial need.
Chevron: Chevron offers multiple scholarships for their employees’ dependents. There are scholarships for undergraduate programs, technical schools, and even awards for graduate students.
PepsiCo: In addition to supplying employees with tuition assistance, PepsiCo also wants to support the children of employees in their pursuit of higher education.
American Airlines: American Airlines provides scholarships for children of employees who are enrolled in full-time undergraduate programs. As long as you are a dependent of someone who fits that criteria at the time of your application, you are eligible for this program.
Wells Fargo: Wells Fargo provides scholarships for their part time and full time employees dependents. These scholarships can be used toward graduate and undergraduate degrees!

Additional Scholarship Opportunities:

UUP Benefit Trust Fund Scholarship Program: A UUP Benefit Trust Fund Scholarship Program is available for undergraduate students. Scholarships of $850 per semester are available for eligible dependent children of active, UUP-represented SUNY employees. Scholarships can be used for, fees, books or supplies (this award cannot be used for room and board or tuition). A maximum of one $850 scholarship per dependent child will be awarded each semester, even if both parents are UUP-represented employees. Eligible dependents, up to age 26, must be enrolled in a SUNY state-operated campus. Dependent children who turn 26 anytime during the semester in which they are applying are no longer eligible. Each dependent child is eligible for a maxiumum of eight scholarships. Scholarship checks will be issued in the UUP-represented employee's name. Applications must be postmarked by 60 days after the end of the semester for which the dependent child is applying. The scholarship form outlines specific criteria that UUP-represented employees and their dependent children must meet to qualify for the scholarship. There are two different forms based on a member's eligibility for the New York State Health Insurance Program. Non-NYSHIP-eligible employees will need to provide documentation verifying that they are the parent of the student.
FEEA Scholarship Program: Some associations and unions partner with FEEA to provide specific scholarship programs for their members, members’ children, grandchildren, or spouses, or retiree members’ children, grandchildren, or great-grandchildren. Because FEEA’s scholarship program is only open to federal civilian and postal workers and their families, each applicant must either be a federal employee or have a parent/guardian or spouse who is a fed.

Tax Implications of Scholarships

In general, scholarships used to cover direct educational expenses (such as tuition, books, and supplies) are usually not taxable. If, however, a scholarship exceeds the total amount you would need to pay for school, then they can become taxable. In the case of many of these companies, you should not need to worry about paying taxes on your scholarships. Whether a scholarship counts as income or not will depend on if it is taxable or not. According to the IRS, any scholarship money not used towards direct school expenses is taxable. Speak with your parents or a professional about your situation to get definite answers about what is required of you and your taxes. Having more money than you need to cover your tuition and expenses while you are in school is a good problem to have! Again, however, this doesn’t mean that the money you receive is all yours to do whatever you want with.

Scholarships used for direct educational expenses are generally not taxable.

Taxable vs. Non-Taxable Scholarships:

Non-Taxable: In general, scholarships used to cover direct educational expenses (such as tuition, books, and supplies) are usually not taxable.
Taxable: If, however, a scholarship exceeds the total amount you would need to pay for school, then they can become taxable. According to the IRS, any scholarship money not used towards direct school expenses is taxable.

It is advisable to consult with a tax professional to understand the specific tax implications of a scholarship.

The Role of Scholarship America

Every year, Scholarship America works with nearly 700 companies to provide more than 50,000 scholarships to children, grandchildren and other dependents of their workforces. Since partnering with our first corporate sponsor almost 50 years ago, we have become the industry standard in workforce scholarship administration. And that first partner? An international workforce is no problem. When J.B.

Read also: Scholarship Guide

Scholarship America partners with numerous companies to administer scholarship programs for employees' children and other dependents.

The Broader Impact of Scholarships

“My family is so thankful to have received the HII Scholarship for my son starting pre-school. It really took away some of that stress around having to worry about books and registration fees. “The HII Scholarship Fund not only provides financial assistance, but also serves as a source of motivation for me to excel in my academic and professional endeavors. “We brought our kids into this world; and, as adults navigating through this journey of life we know that they are going to be told “no” often. But, there will come a time, even if it is only once that someone will say “yes” to their dream, “yes” to their ask, and “yes” to an opportunity. Our kids deserve our help to prepare them for that moment. “Receiving this scholarship will allow me to continue chasing my dreams. “As I prepare to begin my senior year at the University of Southern Mississippi, this scholarship is vitally important. “Receiving this scholarship has alleviated a significant portion of my financial burden and has allowed me to focus on my studies and professional development. “The HII Scholarship Fund will push me one step closer to graduating from college with little to no debt. My desire to be like my dad, a Designer 4 at Ingalls Shipbuilding, sparked my curiosity in engineering, but my school’s robotics team solidified my desire to be an engineer. “I plan to use this scholarship to help fund my education at Clarkson University, where I’m currently working to earn my masters in Environmental Engineering.

Scholarships not only provide financial assistance but also serve as a source of motivation and encouragement for students.

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