Miscellaneous payments represent a broad category and, for Vanderbilt purposes, include prizes, awards, payments for human subject/participants in clinical trials and research studies. Almost all miscellaneous payments will require 30% tax withholding for international persons. In addition, tax treaty benefits rarely apply to miscellaneous payments.
Payments to international persons that are categorized as prizes, awards, or for participation is research studies or clinical trials are taxable. International employees receiving these payments must create a Windstar record or update their Windstar record to show the payment. GSS will create the Windstar record for international persons who are non-employees but the person must complete an online Business Visitor Questionnaire (BVQ).
A separate discussion on payments to Human Subject Participant in clinical trials or research studies can be found by clicking here.
Note: Persons in H-1B status are not permitted to receive compensation for services from any party except the H-1B sponsor. A Vanderbilt sponsored H-1B employee can participate in research or clinical studies and receive compensation. However, a person in H-1B status, who is not sponsored by Vanderbilt, cannot receive compensation from Vanderbilt for participating in research or clinical studies.
In all cases, Windstar must be completed before any payment can be processed regardless of the amount of the payment. GSS recognizes that many participants in clinical trials or research studies will receive very small payments, and normally payments under $30.00. Under IRS regulations, no matter how small the payment, if the payment is subject to taxation, Vanderbilt is required to withhold taxes.
If the department wishes to have the international individual receive the face value of the payment, regardless of the tax, then a request to have the payment "grossed up" must be made. The department needs only to write "GROSS UP" in a prominent place on the check request form.
Reimbursements for Business Purchases
Reimbursement for items purchased for Vanderbilt business purposes (e.g. office supplies, items for a business lunch or other function) are considered business expenses. Business expenses are not deemed taxable income to the individual seeking reimbursement for the purchases. International individuals receiving reimbursements of this type do NOT need to complete Windstar.