The University of Iowa balances a responsibility to maintain various levels of confidentiality for information about human research subjects with record keeping requirements of the State of Iowa, grantor agencies and the Internal Revenue Service. Payments to subjects in research studies will be recorded as a form of compensation. Payment may be a type of remuneration including, but not limited to: checks, cash, gift certificates, personal property and other items of value.
Note: University Cash Handling Policies and Procedures apply when the type of payment is made using cash, gift certificates, personal property or any other item of value. As described in the policy, all University of Iowa units and staff handling these types of payments are required to undergo the departmental and staff certification process.
The University of Iowa has adopted the following procedures to assure that these transactions will be reported in accordance with state and federal income reporting requirements with an appropriate level of confidentiality.
Each individual payment to a research subjects exceeding $25 will require the following information:
- Name of subject
- If not a U.S. Citizen, the following information will be needed.
- Immigration (visa) status
- Tax residency country (may not be the same as citizenship country)
- Permanent foreign address
- U.S. address
- Social Security or Taxpayer Identification Number
- Mailing Address
- Amount paid or value of the item given as compensation
For check payments of $25 or less, the Accounts Payable Office will need all of the above information except for social security number.
Tax Considerations for Non-Resident Aliens
- Federal regulations require that appropriate tax must be withheld at the time of payment. The rate may vary from year to year.
- At year-end, a 1042S tax form is mailed to the individual to be used in preparation of his/her tax return.
Research subject payments to either employees of The University of Iowa or non-employees are charged to institutional account #6240. Payment is processed through the e-Voucher electronic application. A notation of “miscellaneous compensation” is the default in the description field. This is what will be printed on the check stub. Once the form is created on-line & routed electronically (through Workflow) for the appropriate approvals, it is directed to Accounts Payable. The e-voucher can be used to make a single payment to one research subject or payments to multiple subjects (Bulk Voucher). The Bulk Voucher cannot be used when paying a non-resident alien research subject. All payments will be mailed to the research subject unless the “Hold Check” box is marked.
Research subject payments to a non-employee of The University of Iowa exceeding a total of $599 from all University of Iowa sources during any calendar year will result in a form 1099 (Miscellaneous Income) being issued to the individual with a copy sent to the Internal Revenue Service.
Research subject payments to University of Iowa employees will be issued from Accounts Payable and will be separate from an employee’s monthly or bi-weekly payroll check. All research subject payments are taxable income, however, employees will only receive a 1099 Form at year end if the accumulation of payments exceeds $599.
Subjects will be asked to provide the basic information including name, mailing address and social security number. The subjects should be informed that the information allows the University to meet government reporting obligations and precautions are in place to keep this information secure. Subjects may be given the opportunity to waive receipt of payment/s should they wish to not provide identifying information. The Institutional Review Board requires this notification in the language of the Consent Form.
Subjects having a compelling need for confidentiality or a concern that a connection may be made between their identity and a particular research project may be paid from a general use departmental account. The identifying information and the use of institutional account #6240 would still be required. An adjusting entry (CV) to move expense totals from the general use account to the project account will then be made at the department level.
For confidentiality reasons, we have used the notation “Miscellaneous Compensation” in the description field on the e-voucher form. This is what will print on the check.
The information to pay a research subject will be entered on-line into the e-Voucher application and will routed electronically (through Workflow) for the necessary approval/s. In order to protect subject confidentiality, assure the two necessary approvals are received and expedite the payment process, we will request that the minimum number of approval levels have access to these forms in Workflow. Keep in mind that the initiator of the form & one other approval is the equivalent of two required signatures.