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Human Subject Payments & Taxation

With the exception of non-Vanderbilt sponsored persons in H-1B status, international persons can receive a gratuity for participation in clinical or research studies.  Participants are not employees of Vanderbilt University but are considered to be independent contractors for the purpose of receiving the monetary gratuity or gift. It is necessary for records of such payments to be maintained for fiscal and IRS reporting purpose. The International Tax Office (ITO) will create a tax record for all payments where the international participant is identified. 

IRS Reporting of Payments to Human Subject Participants:

Payments made to human subjects who are nonresident aliens are reported on Form 1042-S. All payments to nonresident aliens are subject to 30% federal income tax withholding. 

https://www.irs.gov/government-entities/federal-state-local-governments/de-minimis-fringe-benefits 

Forms To Complete:

International persons (business visitors) receiving payments for compensation as human subject participants are required to complete the online Business Visitor Questionnaire (BVQ) and allow the ITO to create an international tax record before payment will be issued. The online BVQ can be found here.  Note again that persons in H-1B status who have not been sponsored by Vanderbilt University, cannot receive compensation for human subject participation. These persons may participate in clinical or research studies but no compensation can be provided as this violates the terms of their H-1B visa status.  Vanderbilt-sponsored H-1B employees, however, can receive compensation since they hold an employment relationship with Vanderbilt.

Vanderbilt-sponsored international persons in F-1, J-1, TN, H-1B, E-3 or O-1 visa status should not complete the BVQ. If they expect to receive a payment for being a human subject participant, they should update their international tax record (GLACIER) to show receipt of an "Other Payment." If no international tax record exists, access to the database can be requested using the GLACIER Access Request Form