Research Subject Payments Policy
Table of Contents
Policy Statement
The University recognizes the need to provide reasonable incentive payments for individuals who participate in research as research subjects. This policy provides guidelines on such payments.
Research Subject Payments
Payments and incentives given to individuals for research participation are considered taxable payments for services and are subject to IRS income reporting requirements. The University must report all payments made to any single individual in any single calendar year that meet or exceed the IRS reporting threshold unless the recipient is a nonresident alien for tax purposes, in which case all amounts must be reported.
The Principal Investigator is responsible for adhering to the University’s policies and processes for obtaining and remitting the documentation required in connection with federal tax reporting requirements. The Principal Investigator must collect a completed W-9 from each research subject who receives payments of $1,500.00 or more per calendar year, per protocol. Tax reporting may also be required for research subjects who participate in multiple studies or receive other payments throughout the year. In these circumstances, Accounts Payable may request a department to collect a W-9 for a research subject, and departments must comply with this request. Regardless of amount, all payments made to an individual must be supported by complete and relevant support documentation, as detailed further in this policy.
Who is governed by this Policy
This policy applies to any University personnel involved with research and payments to research subjects.
Definitions
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Central Finance: Within this policy, Central Finance includes the Accounts Payable department, the University Controller organization, Treasury, and any other offices that process or coordinate payments, tax reporting, etc.
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Division/departments: References University department personnel directly engaged in making payments to research subjects. These personnel can be the Primary Investigator (PI) and/or other responsible administrative personnel for the research study.
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Expense Reimbursement: Payment to research subject/caregivers for documented, actual out-of-pocket expenses (e.g., transportation, parking, lodging, meals, etc.) incurred as a result of their study participation. Reimbursements that are substantiated with supporting documentation are not taxable and should not be included when computing if a person has reached the tax reporting threshold.
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IRS: Internal Revenue Service of the United States of America.
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Nonresident Alien for tax purposes: As defined by the IRS, any individual who is not a US citizen for tax purposes.
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Payment: Funds paid to an individual for their participation in research projects or reimbursements for expenses. See Payment Types for additional details, requirements, and conditions.
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Research Subject: Human Subject – A living individual about whom an investigator (whether professional or student) conducting research: Obtains information or biospecimens through intervention or interaction with the individual and uses, studies, or analyzes the information or biospecimens; OR Obtains, uses, studies, analyzes, or generates identifiable private information or identifiable biospecimens.
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TIN/SSN: The Taxpayer Identification Number (TIN) is used by the IRS in the administration of tax laws. The Social Security Number (SSN) is assigned to US citizens and some residents of the US while an Individual Taxpayer Identification Number (ITIN) is assigned to others whose requests meet IRS criteria.
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US Citizen for tax purposes: The IRS treats US Citizens and Permanent Residents the same for tax reporting purposes. In the context of research subject payments, tax withholding is not required and amounts are reported for an individual when payments aggregated across the University meet or exceed the IRS reporting threshold.
Required Documentation
Regardless of payment amount, the information listed below is required to be captured by the division/department as part of the research record supporting payment to all research subjects. Payment documentation should be stored separately from research data.
- Subject’s name or identification number
- Date
- Amount
- IRS Form W-9 is required when payment(s) to a US Citizen/Permanent Resident reaches $1,500.00 or more
- All payments to Nonresident aliens for tax purposes require Form W-8BEN using the Sprintax system, which also requires the research subject’s email address.
- Social security number (SSN) of research subjects should not be retained at the division/department level for any reason. At the time that payments to a research subject are approaching $1,500.00, a W9 should be completed and immediately forwarded to Accounts Payable for retention.
Confidential or Legally Restricted information, including the name of the study, should be excluded from your submissions to Accounts Payable of W9s and payment requests, including Supplier Invoice Request. See Data Security Classification Policy for more information about the confidentiality of different types of data.
Payment Types
Below is an abbreviated list of payment methods available for payment to research subjects. Additional details can be found in the Paying Research Subjects guide which outlines authorized methods for compensating research subjects.Payments using systems or mechanisms outside authorized methods are prohibited.
Authorized Payment Methods
- Participant Payment system: Use is required for IRB-approved studies unless an exception is provided by IRB.
- Candex: Use for all research subject payments to non-US persons and project payments not requiring IRB approval.
Transfer of items
Items used as part of the research project may be given to the research subject if there is no further value to the study or creates a burden to collect from the subject. Examples could be fit bits (fitness/health trackers), foot pedals, exercise kits, or similar. Occasionally research sponsors donate items of low value, such as bookbags, with or without logos. For any of these items given to the research subject, the value, in its final condition, should not exceed $100. Offering to the research subject to retain the study item or providing a donated item to the subject is not payment for research participation and is not required or expected.
Reimbursements
Reimbursement to the research subject, or their caregiver, for eligible documented out-of-pocket expenses is not subject to tax reporting provided the following requirements are met.
- Only actual expenses incurred may be reimbursed.
- Expenses must be related to participating in the study.
- As described in the study protocol, expenses reimbursed may be
- travel-related: bus fare, airfare, uber/lyft and similar; for personal vehicle driven mileage rate must be used
- lodging
- meals
- Reimbursement amounts under $50.00 do not require supporting documentation in the form of receipts. Reimbursement amounts of $50.00 or more require a receipt or other documentation supporting the amount being reimbursed.
Special Situations
Research subject is a minor child
If the child is the research subject, they should be paid in their own name and social security number. The method of payment may impact whether payment can be made directly to the minor. If needed, an alternate payment method, for example other than the Participant Payments system, can be used to pay the minor directly.
Research subject is a nonresident alien
Per IRS regulations, the following tax reporting requirements exist for payments to nonresident aliens for tax purposes.
- Payments to nonresident aliens for studies conducted entirely outside of the US (e.g., online survey where non-US subjects are targeted, researcher traveled outside of US to conduct surveys/research on subjects) are exempt from IRS tax withholding. However, payments being made to individuals or entities outside the U.S. do require review and verification to ensure that financial assistance is not being provided to a blocked or sanctioned individual/entity.
- Otherwise, all research subject payments to nonresident aliens require 30% to be withheld for taxes and remitted to the IRS at the end of the month.
Resources
The Research Subject Payment Procedures provides information on procedural details, including additional forms and resources, related to information collection and reporting to Accounts Payable.
Related Policies
This listing includes the policies related to research subject payments, including considerations for potential tax reporting.
- Honorarium Policy: Defines the circumstances under which honoraria may be paid. Information on criteria, visa eligibility/requirements, tax withholding and reporting, as well as documentation requirements.
- Payments to Foreign Nationals: Information regarding payments to nonresident aliens for services and prizes/awards that are taxable and require tax withholding
- Petty Cash Policy: Policy governing establishment and use of petty cash funds
- Worker Classification: Employee vs. Independent Contractor: Provides the procedures for assessing whether an individual performing services for the University is properly classified as a University employee or as an independent contractor
Contacts
- Research Subject Payments Policy inquiries
Accounts Payable
AccountsPayable@ur.rochester.edu - Business Expense Policy inquiries
Accounts Payable
AccountsPayable@ur.rochester.edu - Employee and Student Expense Reimbursement related inquires
Accounts Payable - Purchasing Buying and Paying Guide: Preferred procurement method, preferred suppliers, Workday P2P Functionality, Independent Contractors
Corporate Purchasing - International considerations for research subject payments
Office for Global Engagement
Global@rochester.edu - Award- and Grant-specific inquiries
Office of Research Accounting and Costing Standards (ORACS) - Tools and support to help faculty and staff with administration of clinical trials (i.e.: OnCore or Participant Payments)
Office of Clinical Research - Institutional Review Board process and approval status
Office for Human Subject Protection - Tax reporting considerations outside of this policy
Tax Department
TaxDept@finance.rochester.edu