How do you indicate a first choice college for national merit?

Some schools like Pepperdine and USC require you to indicate they’re your first choice when applying in order to get half-tuition from NM. Do you have to report to the college that they are your first choice? And, if you’re rejected will you not be able to use the scholarship elsewhere? I just worry that I’ll apply somewhere as my first choice and won’t get in, then my scholarship will be wasted and I’ll have to go somewhere else for full tuition.

USC requires you to report they are your first choice AFTER you have been accepted AND have made the decision to enroll there- not before. In other words- you notify NM in mid May of your first choice college.
Doing so before then is not necessary.
The 1/2 tuition scholarships are provided by the COLLEGES, so obviously they will ONLY be given to students that actually go there.

There was a First Choice form that NMFs used to fax to NMCorp. Does that still exist?

I think everything is online now.

Yes…I just looked it up…the student logs into NMCorp and selects his first choice.

Wait, so does that mean after you know where you got accepted you choose and then get the scholarship from NM if applicable?

"Wait, so does that mean after you know where you got accepted you choose and then get the scholarship from NM if applicable? "

YES.
The big NM Scholarships come directly from the college , not from National Merit Corporation.

and you wont get any $$ IF the college you enroll in does NOT sponsor National Merit.
The Ivys dont. Stanford doesnt. But many other colleges DO.
So be SURE you apply to colleges that DO sponsor National merit scholars IF you are on the hunt for merit $$. And dont waste mentioning NM to colleges that dont sponsor it.

National Merit ALSO gives NM Finalists who enroll at colleges that
sponsor National Merit [ i.e. help to support the NM corporation] additional small scholarships ranging from $1000-2000/ yr.

I think you just need to pick the top choice school by the deadline given by NM corp. I think it is some time in March.

^^no , the deadline is AFTER students have found out where they have been accepted AND have notified the college where they have decided to enroll.
i.e. in May.