College Tuition Fees : In State vs Out Of State Fees

In Universities by Raghuram Sukumar

(Rewrite: Explain in detail about in-state and out of state, give examples with links to universities, show the difference in tuition fees, show how much one can save and why private schools don’t have in-state fees.)

There are several differences between “in-state” and “out-of-state” college tuition fees. Many students are confused about their college tuition fee structures, especially international students who typically must pay out-of-state tuition fees.

Before I explain about their difference, it would help if I first discuss some related terms:

  • Public Universities
  • Private Universities
  • State Tax funding

To run any university, money is needed. Where that money is sourced from categorizes colleges and universities. So we have public and private colleges and universities depending on where the funds are sourced to operate them.

Public Universities

In the U.S., every State has both a State Tax and a Federal Tax. While all American States have federal tax, there are some that don’t collect state tax, but majority of them do. And for every money earned, Americans must pay both state tax and federal tax.

Revenues collected from state tax are used by State governments to fund government operations, which also include allocations for schools, colleges, universities and the like. As such, these schools that are funded by state tax are called Public Schools.

Private Universities

Unlike public academic institutions, private schools don’t get funding support from the State government. These private organizations raise funds from donations, rewards, and of course tuition fees paid by the students.

Because of government-provided privileges and exemptions, students attending public universities will pay tuition fees much lower in comparison to those attending private universities.

In-State fees vs Out-of-State College Fees

Students who are residents of a particular State are required to pay in-state fees because their school is operated using State funds (primarily sourced from tax collections). Normally, in-state fees are lower.

Out-of-state fees, is paid by students who are not residents of that State where they go to school. For instance, when a student goes to school in Texas, but lives in Florida, he/she must pay out-of-state fees simply because the school (in Texas) is outside the student’s residence (Florida).

Example – University of Texas System

For 9 credits (usually 1 course = 3 credits)

Out of State tuition and International ~= $6,000
In State Tuition fee ~= $3,200

So now you can clearly see their difference. In the next post, I will talk about how this will impact International Students. I will elaborate on the question: “What happens if an International Student gets an RA/TA or a Scholarship grant?”