I would heartily disagree that the University is required to report the travel expense as "income" to the students. It was actually paid to the travel suppliers from the research project, for the purpose of transporting volunteer researchers to the research site where they volunteered their services to benefit the research project. I argue that this was not compensation to them to benefit their study program, but payment of their costs performing the research program. Again, I argue that just because the students are required to travel as part of the educational program does not cause all payments for such travel to be primarily for their benefit. In this case the primary benefit was the research program. It is merely incidental that the foreign travel also satisfied educational program requirements. The students volunteered their time to do research. The travel payments would not be "income" if they were paid by the grant for services rendered. Whish is why I earlier suggested reporting this as third party cost sharing. Chuck At 02:37 PM 11/17/2004, you wrote: >It seems that we might need more information to be of more specific >assistance. That having been said, the issue seems to be one not >necessarily related to the withholding of tax, but rather, whether the >payment of this travel on a student's behalf constitutes reportable >income (i.e. whether it needs to be included/reported on a Form 1099 or >Form W-2). Although the students receive no salary or stipend per se, >the payment of travel expenses creates a quid pro quo situation. They >are being 'compensated' (albeit perhaps not fairly) for their >participation. The question is whether that compensation (payment to or >on behalf of) is reportable as income. If the answer is yes, the second >question is whether the university has an obligation to withhold tax. > >Helen K. Mourat >Senior Grants and Contracts Officer >Research and Technology Development Services >Georgetown University >Harris Building, Suite 103 >3300 Whitehaven Street, NW >Washington, DC 20007 >(202) 687-1207 >(202) 687-3825 (fax) > >-----Original Message----- >From: Research Administration List [mailto:xxxxxx@HRINET.ORG] On >Behalf Of Pamela Miller >Sent: Wednesday, November 17, 2004 1:33 PM >To: xxxxxx@HRINET.ORG >Subject: [RESADM-L] group think > > >I have run into an impasse with our Comptroller, and I need HELP. > >We have a PI that has a sub from another university to carry out >research for the USAID. > >Our PI has master's students that are helping to conduct this research >under this contract. The students receive no salary or stipend for >their help. However, project funds are used to pay for the student's >travel to Latin America so they can assist the PI with the research. > >The problem is that our comptroller's office thinks that the students >should be taxed on the funds spent on their travel because the students >are part of a master's program that requires them to travel abroad and >to write a master's paper. > >The comptroller argues that the travel funds are taxable because the >students are "benefiting" from the travel in that the students can use >this experience in Latin America to satisfy the travel requirements of >their master's program and they might actually do some work (i.e., learn >something) in Latin America that they could write about for their >master's papers. > >I argue that the students are not required to do their master's paper on >any topic related to this subcontract or to satisfy their field >experience by working on his project in Latin America. They have other >choices. They also earn no course credit for their participation in the >project. Also, the funds spent for student travel is for the >University's benefit (to comply with the terms of the sub) not the >student's. > >Now because of this impasse, I will have to get a no cost extension so >that we can iron things out and I am told I need to talk to a new tax >person that has been hired who needs time to "look this up." > >Has anyone out there faced anything like this? I need specific >citations to back up my position. It seems to me that this type of >reasoning will undermine the very point of research in higher ed! > >Pam > > >Pamela F. Miller, Ph.D. >Director, Office of Sponsored Projects >The University of San Francisco >2130 Fulton Street >San Francisco, CA 94117-1080 >TEL 415-422-5368 >FAX 415-422-6222 >EMAIL xxxxxx@usfca.edu > > >====================================================================== > Instructions on how to use the RESADM-L Mailing List, including >subscription information and a web-searchable archive, are available >via our web site at http://www.hrinet.org (click on "Listserv Lists") >====================================================================== > > >====================================================================== > Instructions on how to use the RESADM-L Mailing List, including > subscription information and a web-searchable archive, are available > via our web site at http://www.hrinet.org (click on "Listserv Lists") >====================================================================== Herbert "Chuck" Chermside, CRA Director Emeritus, VCU Sponsored Programs Executive Director, Research Administrators Certification Council 1915 Robindale Rd. Richmond, VA 23235-3931 804-320-5502 xxxxxx@verizon.net ====================================================================== Instructions on how to use the RESADM-L Mailing List, including subscription information and a web-searchable archive, are available via our web site at http://www.hrinet.org (click on "Listserv Lists") ======================================================================
