Annual Leave Exchange Benefit

If you have student loans in your name, you can cash in unused annual leave to reimburse your loan payments. The payments you receive after converting your annual leave are taxable and will be added to your paycheck.

This new benefit starts March 1, 2026! You won’t be able to access the PTO Exchange system until then.

A financially smart decision

Defaulting on your student loans can have serious long-term financial consequences. When you miss payments, your credit score may drop significantly, which can affect your ability to qualify for credit cards, car loans or even rent an apartment. In contrast, making timely student loan payments not only helps you avoid these negative outcomes but also builds a positive credit history, opening doors to better financial opportunities in the future. Staying current on your loan obligations is a powerful way to safeguard your financial well-being and set yourself up for lasting success.

Eligibility

To convert your annual leave to taxable cash reimbursements, you must:

  • Have an annual leave balance of at least 80 hours after an exchange.
  • Make a payment toward an eligible student loan. Eligible student loans include loans that you took out to pay for qualified higher education expenses that were for you, your spouse or your dependent. The loan must be in your name, even if it was for someone else.
  • Have no disciplinary warnings or actions related to leave within the previous 12 months.

How It Works

You can exchange your accrued annual leave for payments toward qualified student loans up to $7,500 per year. These payments are considered taxable under federal law.

The IRS does not allow a dollar-for-dollar exchange of annual leave. When you exchange your annual leave time for cash payments, there will be a 14% exchange reduction.

What does an exchange look like?

For an employee who makes $25/hour and exchanges eight hours of annual leave, the exchange would look like this:

eight hours of annual leave at $25/hour = $200
$200 - 14% exchange reduction = $172

The $172 will be added to your paycheck as “additional earnings” and eight hours will be deducted from your annual leave balance. The $172 payment will be taxed like your regular paycheck.

Proof of payment

You will need to upload proof of a student loan payment (screenshot, receipt, etc.) when you submit your exchange request. Your proof document must include your name as the signer on the loan.

The student loan payment must have been made on or after July 1, 2025, to be exchanged.

Make a plan before you exchange

Plan your annual leave time off for the next year or two before you make an exchange – you’ll want to make sure your time off is covered. 

Making an Exchange

The university is working with PTO Exchange to facilitate the annual leave exchanges. To submit your request, follow these steps: 

  • Log in to Azure and select PTO Exchange.
  • On your PTO Exchange Dashboard, you will see:
    • The amount of annual leave available to be exchanged (annual leave you have accrued beyond 80 hours).
    • The exchange value of your annual leave based on your pay rate. Note: You can exchange only up to $7,500 per year.
    • The total amount of annual leave you have accrued (the amount of annual leave available to be exchanged plus 80 hours).
  • Select Education to make an exchange. Once you have submitted $7,500 in student loans for the year, the Education button will disappear from your Dashboard until the following year.
  • Fill out the exchange form and click Submit. You will need to upload proof of a student loan payment. You will receive an email confirmation of your completed transaction. 
  • Wait for your campus human resources office to review and confirm your eligibility. If you’d like to check the status of your submission, log into PTO Exchange and check the Recent Activity section on the Dashboard. 
  • After approval, you will receive a cash payment with your paycheck.