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Finance & Administration > FAPolicies > Purchasing & AP > Remuneration for Research Trial Participants
Remuneration for Research Trial Participants
Section:6- Purchasing & Accounts Payable
Policy Procedure:6-13.0
Subject:Remuneration for Research Trial Participants
Established Date:07/01/2012
Responsible Department:Disbursement Services (AP)

Overview

The Medical University of South Carolina (MUSC) balances its responsibility to maintain confidentiality of information about human research participants with record keeping requirements of the State of South Carolina, grantor agencies, and the Internal Revenue Service. Therefore, MUSC has developed a policy that: a) protects the confidentiality of research participants’ personal identifying information such as name, address, and social security number to the greatest extent possible; b) identifies cases in which the total human research participant reimbursement payments per individual per year are likely to exceed the $600 threshold that, by law, requires reporting of income to tax authorities ; and c) insures that all research participants are notified that all research participation payments are taxable income. MUSC recognizes that some types of research pose threats of harm to research participants if their identities or research information is made available to anyone other than members of the immediate research team. Consequently, the MUSC policy also has special procedures to be followed in such cases.

The policy recognizes that Principal Investigators (PIs) have a special duty under federal law to protect research participants and that PIs are in the best position to know whether total payments per year on a given research study will approach or exceed the $600 per year reporting threshold and whether disclosure of research participants’ personal information to those outside of the immediate research team would pose special risk to participants. Therefore, the MUSC policy requires PIs to serve as “gatekeepers” who must determine when an IRS Form W-9 (W-9) will be collected from research participants, when it will be shared with other MUSC officials, and when special confidentiality procedures should be invoked, precluding collection of W-9 form information or disclosure of any information about research participants to anyone outside the immediate research team. This policy requires all PIs to inform all research participants that any payment they receive for research participation is taxable income by providing each participant with a Research Study Payment Information Document or informed consent document with appropriate language.


General Guidelines

Payments to individuals for participating in research studies will be recorded as remuneration. Payment types may include, but are not limited to: checks, petty cash, gift certificates/cards, personal property, and other items of value. MUSC has adopted the following procedures to ensure research participant payments are reported in accordance with state and federal income reporting requirements, while maintaining an appropriate level of confidentiality.

  1. The PI will be responsible for informing research participants that the value of any remuneration they receive for participation in research studies  is taxable income by providing each participant with a Research Study Payment Information Document  or by inclusion of similar verbiage in the informed consent document.
  2. The PI will keep a record of all remuneration payments provided to each research participant.  The study’s schedule of payments should be used to determine if W-9s should be collected.  If  the remuneration amount reaches or exceeds $600 within a calendar year for any research participant, the PI will send the W-9 form for that participant to the MUSC Accounts Payable office with a statement of the total amount received by that participant.  In no case will the W-9 form completed by the research participant, income forms provided to state or federal tax agencies, or income forms provided to the research participant include any information indicating that payment was received for participating in research studies.  These records will be retained by the PI and kept in a secure location separate from the research data file.
  3. Some research studies deal with extremely  sensitive topics that are sufficiently stigmatizing or that pose sufficient risk if participants’ identity, personal information, or data are disclosed.  For these research studies the federal government has determined that special confidentiality safeguards are needed to protect research participants’ identity, personal information, and research data. In such cases, PIs may apply for Certificates of Confidentiality from the National Institutes of Health or other federal agencies.

Reimbursed transportation expenses are not reported by MUSC to the Federal Government (Form 1099-MISC) provided documentation is submitted to substantiate the expenses, as required under MUSC’s travel expense rules (Policy 7.17.0).  Generally, receipts or other documentation is required.  Please consult with your Department Administrator for assistance with the processing of reimbursements.

Methods of Human Subject Payments

1.)    University Check

Note: Due to the overall cost of processing, checks should not be requested for payments less than $100, unless the recipient is a Non-Resident Alien.

2.)    Gift Cards

3.)    Petty Cash

4.)    Gift items (tangible personal property)

MUSC is obligated to report to the IRS all individuals (U.S. Citizens or Resident Aliens) who receive income greater than the annual threshold of $600.  The IRS W-9 form is to be collected from human research participants  that receive remuneration consistent with the policies described above.  (Note: These W-9 requirements apply to all forms of payments.  Gift cards or gift certificates, petty cash and the value of tangible items must be considered when determining the remuneration amount received from MUSC.)

Non-resident Alien Withholding

Payments to non-resident aliens (individuals who are not U.S. Citizens, permanent resident aliens or resident aliens for tax purposes), regardless of the amount, are subject to 30% federal income tax withholding.  Researchers are not required to determine whether any research participant is a non-resident alien, but if it is determined that a research participant falls into this category, the 30% must be deducted.  If the research participant is paid by check, name, address, and social security (or other valid tax id) information must be obtained, as is the case for all payments by check. 

Payments to Employees

Payments made to an employee who is participating in a research study will be treated the same as payments made to a non-employee, provided that all of the following conditions are met:

  • The employee’s participation is totally voluntary and not part of their University duties;
  • The employee’s participation is on their own time;
  • The employee does not perform any service while participating in the research study that would be performed in the course of their regular duties for the University; and
  • The employee is being paid the same as all other participants of the study, with no added benefits for participating.

It is the responsibility of the paying department to assure that these conditions are met.  If all of the conditions are satisfied, payment can be made according to the provisions of this policy.  After the calendar year-end, a Form 1099-MISC will be issued to any employee who is paid $600 or more for their participation in research studies and all other non-employee compensation. 

If any condition is not satisfied, payment must be processed by submitting an Employee Remuneration Request Form for Research Trial Participation .  Remuneration will be reflected on the employee’s next scheduled paycheck with applicable employment taxes withheld and will be reported on Form W2 after calendar year-end. 

Responsibility

The W-9 forms should be forwarded to the Accounts Payable Section of the Disbursement Services Department, who will report cumulative payments to individuals based on social security number (SSN).  To calculate an individual’s total income from the University for one calendar year, Accounts Payable will match an individual’s SSN with all reported payment types, including cash from a petty cash fund, money orders, gift cards, and any distribution with a monetary value.  Accounts Payable will consolidate human subjects’ accumulated remuneration/data based upon reports submitted by Departmental Custodians and Principal Investigators.

 

Procedures

Payment by University Check

Payment Using Gift Card

  • PIs will be responsible for collecting the required information from the research participant consistent with the policies described above.  If required by the policies above, tax information on individuals (excluding study name) must be supplied to the University Accounts Payable Office no later than January 5th of the following calendar year.

  •  PIs will maintain a list designating the issuance of each card with a signature of the person receiving the card or the PI/designee signing for the issuance.  All cards must be accounted for prior to submitting a request to purchase more cards.

      ●    The amount should not be more than what the IRB has approved.

Payment Using Cash

  • PIs will be responsible for collecting the required information from the research participant consistent with the policies described above. If required by the policies above, tax information on individuals (excluding study name) must be supplied to the University Accounts Payable Office no later than January 5th of the following calendar year.

  • PIs or Petty Cash Custodians will maintain a list designating the issuing of all petty cash with a signature of the person receiving the funds or the PI/designee signing for the issuance.  All funds must be accounted for prior to submitting a request to replenish the account.  See Finance and Administration Policy 1-8.04 for instructions.

  • The amount should not be more than what the IRB has approved.

Payment Using Tangible Personal Property

  •  PIs will be responsible for collecting the required information from the research participant consistent with the policies described above. If required by the policies above, tax information on individuals (excluding study name) must be supplied to the University Accounts Payable Office no later than January 5th of the following calendar year.
  • One-time payments using Tangible Personal Property with value less than $25.00 are considered de minimis and thus not subject to reporting.
  • PIs will maintain a list designating the issuing of all Personal Property Gift items with a signature of the person receiving the items or the PI/designee signing for the issuance.  All items must be accounted for prior to submitting a request to replenish the account.
  • The amount should not be greater than what the IRB has approved.

General Gift Card Guidelines:

A)  If processing a Purchase Requisition (RQ) for the purchase of gift cards, the check is to be made payable to the Issuer of the Gift Cards.  The check should be held for pick-up and picked up by an authorized representative of the research trial to be used to purchase the gift cards from the chosen vendor.

B) Gift cards are considered to be equivalent to cash and must be treated as such.  If gift cards purchased for a study are not completely used, then it is the department’s responsibility to have a procedure in place to secure the gift cards for use on future studies using gift cards as a payment method. 

Petty Cash Guidelines:

When using Petty Cash, the department is responsible for following University established policies and procedures; 
A.)  Petty Cash Guidelines.  Policy 1-8.

B.)  Establishing a Petty Cash Account.  Policy 1-8.02

C.)  Replenishing a Petty Cash Fund. Policy 1-8.04

The responsibility for collecting W-9 information and for reporting cumulative payments to Accounts Payable rests with the Principal Investigators and their departments.

All penalties incurred due to non-compliance with the policies described above regarding tax withholding and reporting requirements are the responsibility of the relevant department(s).

Contact Information

University Accounts Payable Office Phone:  843-792-4343

Office of Research Integrity  Office Phone:  843-792-4148


Questions regarding the processes for making payments to research participants may be directed to the University Accounts Payable Department.

Information regarding privacy and confidentiality is found in the MUSC Human Research Protection Guide Section 4.13 - Privacy and Confidentiality and questions related to this topic should be directed to the Office of Research Integrity.

Forms

Employee Remuneration Request Form for Research Trial Participation

MUSC Purchase Requisition

Research Study Payment Information Document

IRS Form W-9


Page last updated:03/27/2013

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