What Your Tutoring Package Agreement Must Spell Out: A Checklist

Expiration: what your state allows on prepaid service credits

Before you sell session packages, check if your state regulates expiration dates on prepaid services. Many states treat prepaid tutoring credits much like gift cards or unclaimed property. This means you may not be allowed to set an arbitrary expiration date. Some states have laws that ban expiration dates under a certain number of years, or require you to refund unused credits after a period of inactivity. Others may allow expiration if you spell it out clearly in your agreement.

If your state is silent on the matter, an expiration policy is still important for managing your schedule and cash flow. Without one, clients may try to use credits years after purchase, possibly with different rates or staffing. Set an expiration period that makes sense for your business, one year from purchase is common, but always write the exact number of months or years in the contract. Avoid vague terms like "reasonable time."

Include a statement about what happens to unused credits at expiration. Do they become forfeited? Are they converted to a refund or held as a credit balance? State law may dictate the answer, so check before you decide. If you extend or renew credits as a courtesy, note that this is voluntary and not an ongoing guarantee.

Refund and cancellation terms written in plain language

Parents want to know: can they get money back if their child stops tutoring, and under what terms? Spell out your refund policy using short sentences and everyday words. "Unused sessions are refundable within 30 days of purchase, minus a $20 processing fee," for example, leaves little room for confusion. If you do not offer refunds, say so directly. Many tutoring centers offer partial refunds for unused credits only within a set time frame, or none at all for discounted packages.

Cancellations before the package starts are another area for clarity. If you allow a full refund before the first session, say so. If you keep a deposit, state how much and why. For ongoing clients, include rules about canceling mid-package: is there a penalty? Will you pro-rate the refund based on remaining sessions at the package or single-session rate?

Be thorough, but avoid legal jargon. Parents appreciate knowing exactly what to expect, and clear terms reduce disputes. If you use automated systems to handle refunds, describe the process, but still include contact information for parents who want to talk to a real person.

Keep reading: Where a $70 Tutoring Hour Goes: Tutor Pay, Fees, and Idle Time

Transfers between siblings, subjects, and tutors

Families often want flexibility when life changes. Can prepaid credits be used by a sibling if one child loses interest? Can parents switch credits from math to reading, or from one tutor to another? These questions come up more than you might expect, especially for larger families or centers with multiple staff.

State your transfer policy up front. Some tutoring businesses allow transfers between students in the same household, as long as the sessions are at the same rate. Others limit this to prevent "sharing" of packages across extended families. If you permit switching subjects or tutors, note any restrictions. For example, "Credits can be used for any subject at the same rate, but may not be applied to test prep or college counseling."

Explain your process for authorizing transfers. Does the request need to be in writing? Is there a deadline, such as within 90 days of purchase? If you charge a transfer fee, include the amount. Avoid surprises by making these rules part of the original agreement.

Late cancel, no show, and make up rules stated as actual numbers

Missed sessions are a constant headache. Your agreement must specify what counts as a late cancel, what happens with no-shows, and how make-up sessions work. Use actual numbers, not phrases like "adequate notice." For example, "Cancellations with less than 24 hours' notice are charged as a full session."

For no-shows, define exactly when a session is forfeited. Some centers allow a grace period, say, 10 minutes past the scheduled start, while others count any absence as a no-show. Make this explicit to avoid arguments.

Make-up session policies should also be spelled out. Do you allow one make-up per package? Must it be scheduled within a certain number of weeks? Are make-ups only available if the tutor cancels? These details protect your time and help parents plan ahead. If you use a booking platform that automates these rules, mention how it works.

Rate increases mid package and how much notice you give

Parents who buy large packages want to know how long their rate is locked in. Make it clear whether the package price covers all sessions, no matter when they are scheduled, or if rates can change before all credits are used. Most tutoring centers honor the original rate for prepaid credits, but require new packages to be purchased at current rates.

If you reserve the right to raise rates mid-package, state exactly how much notice you will give, 30 days, 60 days, or whatever you decide. Explain whether clients can use existing credits at the old rate until a certain date, or if they must pay the difference. Clarity here helps avoid tense conversations later and builds trust with families.

Include a section on how parents will be notified: email, phone, or written notice. Automated systems can help you send timely updates, but your agreement should still describe your process.

Keep reading: The August to October Ramp: How Fall Tutoring Schedules Fill

Who holds the remaining credits if a tutor leaves your roster

Turnover happens, especially for part-time tutors or those moving on to other jobs. What happens to prepaid sessions when the assigned tutor leaves? Does the center reassign the student to another tutor, or offer a refund? For independent tutors, is there a backup plan?

State your policy in plain terms. If your business is responsible for finding a replacement, reassure parents that their credits are safe and will be transferred. If a parent prefers to wait for a new tutor or receive a refund, spell out the process and timeline. For solo tutors, it is wise to name a trusted colleague or partner who can take over in emergencies, with the parent's consent.

If your agreement requires parents to use credits within a set period even if a tutor changes, make that clear. Some centers offer a short grace period for families to decide. Whatever your approach, transparency prevents misunderstandings during stressful transitions.

Progress reports, communication windows, and parent access

Parents expect updates on their child's progress and want to know how to reach you between sessions. Your agreement should describe how and when you provide progress reports, as well as what kind of information they contain. Do you email a summary after every five sessions? Offer feedback in person or through an online portal? Specify the frequency and format.

Communication windows are also critical. Make it clear when and how parents can contact you: office hours, response times for emails or texts, and emergency contacts. If your staff works limited hours, set expectations for typical reply times. For larger centers, designate a primary contact so messages do not fall through the cracks.

Finally, explain what information parents can access about their child's sessions. Some programs allow parents to view attendance and session notes online. Others send printed reports. If you offer parent portals or digital summaries, describe how these work and how to request access. Clear guidelines here support strong parent-tutor relationships and increase satisfaction with your services.

Payment method, receipts, and whether your state taxes instructional packages

Flexible payment options can make or break a sale. Your agreement should list all accepted forms of payment: credit card, check, ACH transfer, or cash. If you require payment in full before sessions start, state this. For installment plans, detail the schedule and any fees for late payments.

Always provide receipts, whether by email, paper, or through an online portal. Receipts help parents track spending and can be important for reimbursement from flexible spending accounts or tax purposes. If you use a payment platform that sends automated receipts, mention this in your agreement.

Sales tax on tutoring is a tricky area. In many states, instructional services are not taxed, but there are exceptions. Some states tax certain types of tutoring, such as test prep or enrichment, while exempting remedial instruction. If you operate in a state with sales tax on tutoring, your agreement must specify whether tax is included in the package price or added at checkout. If you are unsure, consult your state revenue department or a local accountant before finalizing your agreement.

See how TutorCredits handles this for tutoring

Progress reports, communication windows, and parent access

Providing regular updates and open channels for parent communication can set your tutoring service apart. State in your agreement how often you send progress reports, such as every four or six sessions, and by what method. Make clear how parents can reach you outside scheduled sessions, and whether you guarantee a reply within a set number of hours or days. If your business uses a parent portal, describe what information is available and how to access it.

Parents appreciate knowing they can follow their child's progress and ask questions as needed. Detailed communication policies reduce confusion and help build trust. For multi-tutor centers, ensure each family has a named contact who can provide updates and answer questions promptly. Automated systems can help deliver reports and manage communications, but always provide a way for parents to reach a real person if issues arise.

Payment method, receipts, and whether your state taxes instructional packages

Spell out exactly how you accept payment: credit card, check, ACH, or cash. If you require payment up front, say so in plain language. For recurring payments, list the schedule and any fees for failed transactions. Always provide receipts, either automatically by email or through your booking platform, to help parents track their purchase and seek reimbursement if needed.

Sales tax rules vary by state and even by locality. In some places, tutoring is exempt from sales tax, while in others certain types of instruction or test prep are taxable. Confirm the current rules for your location, and state in your agreement whether tax is included in your package price or added at checkout. If your platform handles tax calculation, mention this for transparency.

Closing the loop: making your policies easy to follow and enforce

Clear, thorough agreements make your tutoring packages easier to sell and manage. They reduce disputes, save time, and build trust with your clients. Writing out each policy in concrete terms, expiration, refunds, transfers, cancellations, and more, protects both your business and your clients' expectations. Keeping your policies up to date and consistent helps everyone know what to expect.

Today, many tutoring businesses use digital tools to automate credit tracking, enforce policies, and keep parents in the loop with timely reports and alerts. Systems that automatically deduct credits, flag low balances, and send regular progress reports can take much of the manual work out of package management. These features keep your agreements consistent and transparent, and they support the professional image that helps small tutoring businesses thrive.