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Human Subject Payments for Participation in Research


Human Subject Payments and Tax Reporting Obligations Overview

The term “human subject” refers to a living individual about whom an investigator (whether professional or student) conducting research obtains data through intervention or interaction with the individual. Human subjects may be compensated for their participation in research projects in cash, cash equivalent (prepaid credit cards or gift cards), or small gifts of modest value.

IRS rules require the University to issue a Form 1099-MISC to any individual to whom it made payments, including human subjects payments, totaling $600 or more during a given calendar year. For non-cash payments such as food items or clothing, the items must be assessed a dollar value and counted towards the $600 threshold.

The University generally requires the collection of social security numbers from all human subjects to fulfill its tax reporting responsibilities. Human subjects must complete Form W-9 “Request for Taxpayer Identification Number” or the study staff must collect the equivalent information through an alternate form and such information should be held in strict confidence. There are two primary exceptions to the requirement to obtain a Form W-9: (i) studies with subject payments under $50 in total; and (ii) confidential studies.

Studies with Payments Under $50

Many human subjects participate in only a single study that pays far less than the $600 reporting threshold which leads many to question why collecting tax information is required at all. The reason is that it’s not uncommon for certain subjects participate in multiple trials which, in aggregate, may very well exceed the $600 reporting threshold.  However, where study payments are very modest, the likelihood of exceeding the threshold becomes quite remote. Accordingly, the collection of tax information is not required if the total payment for a single study is $50 or less per individual during the calendar year, provided there’s no actual knowledge that subjects are anticipated to participate in other similar or connected studies which, in aggregate, are likely to exceed the threshold.

For more information, see the IRB’s procedure titled “Compensation to Research Trial Participants.

Confidential Studies

In certain circumstances, collection of personal information is reasonably likely to hinder performance of a study due either to the nature of the information collected or because collection of personal data would deter subject participation. In such cases, the IRB will require a study to be performed without the collection of personal information in order to protect the privacy of the subjects; however, the total payments to any individual subject participating in the confidential study cannot be equal to or greater than $600.

Questions or Comments?

Please contact us with any questions about tax compliance issues or contracting activities.

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