Can You Do Work-Study and Have a Job?

College students often seek ways to manage higher education costs and gain professional experience. A common consideration is holding both a Federal Work-Study position and an additional job. While generally possible, students should understand the distinct financial and practical implications.

Understanding Work-Study and Outside Employment

Federal Work-Study (FWS) is a form of financial aid providing part-time employment to eligible students with demonstrated financial need. Students earn money to help cover educational expenses, with positions on-campus or with approved off-campus non-profit organizations. Earnings are capped by their work-study award amount.

Students are generally permitted to hold an additional job alongside their work-study position for increased income. Institutions usually have policies regarding student employment, so students should consult their school’s financial aid office for specific rules or limitations.

Work-study jobs are primarily a supplement to financial aid, not a source of full-time income. They are designed to accommodate academic schedules, with typical work hours not exceeding 20 per week during academic terms. Their purpose is to assist students in financing education while offering relevant work experience.

Financial Aid Implications

Income from an outside job can affect a student’s eligibility for future financial aid. When completing the Free Application for Federal Student Aid (FAFSA), non-work-study income is reported and contributes to the Student Aid Index (SAI) calculation. This calculation determines how much a family can reasonably contribute to educational costs.

An increase in a student’s reported income from an outside job can lead to a higher SAI, potentially reducing need-based financial aid for subsequent academic years. The FAFSA typically considers income from the “prior-prior year,” meaning income earned two years before the academic year for which aid is sought.

Federal Work-Study earnings receive favorable treatment on the FAFSA. Unlike income from other jobs, work-study earnings are often excluded from the SAI calculation and do not negatively impact a student’s eligibility for future aid. This allows students to earn money without jeopardizing their need-based financial assistance. It is important to accurately report all income sources on the FAFSA, distinguishing between work-study and other employment income.

Practical Management of Multiple Commitments

Balancing a work-study position, an additional job, and academic responsibilities requires effective time management and organization. Creating a detailed schedule for classes, study, work, and personal activities can help. Prioritizing tasks and setting realistic expectations for each commitment is important to avoid feeling overwhelmed.

Maintaining academic performance is a primary concern, as working too many hours can sometimes impact grades. Students should regularly assess their workload and communicate openly with supervisors at both jobs and academic advisors about their availability and challenges. Seeking support from campus resources, such as tutoring centers or counseling services, can also help manage the demands.

Self-care and avoiding burnout are important when juggling multiple commitments. Ensuring adequate rest, nutrition, and opportunities for relaxation helps maintain overall well-being. Proactive communication and careful planning can allow students to successfully manage their work and academic obligations.

Tax Treatment of Earnings

Earnings from both Federal Work-Study positions and outside jobs are generally considered taxable income. Students typically need to report these earnings on their federal and state income tax returns. Students will receive a Form W-2 from each employer detailing their annual earnings and any taxes withheld.

Federal Work-Study earnings are exempt from Federal Insurance Contributions Act (FICA) taxes (Social Security and Medicare) for students enrolled at least half-time. However, federal and state income taxes are still typically withheld from work-study pay. Income from an outside job, if classified as an employee, will also have federal and state income taxes, as well as FICA taxes, withheld.

If a student works as an independent contractor for an outside job, they receive a Form 1099-NEC instead of a W-2. Independent contractors are responsible for paying their own self-employment taxes, which cover Social Security and Medicare, and often need to make estimated tax payments throughout the year. Filing a tax return may be beneficial to receive a refund of any withheld taxes.