Policy Information

Date Established: 3/5/2004
Date Last Revised:
Category:
Human Resources
Responsible Office:
International Employment
Responsible Executive:
Vice President for Finance and Administration

Policy Contents

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Honoraria Payments (State)

This policy is in effect even though it has not gone through the policy review process.

Summary

The University at Buffalo recognizes the need to process honoraria payments for citizens, resident aliens, and non-resident aliens. This policy defines the appropriate process for honoraria payments.

Policy Statement

Payment of honoraria for non-resident aliens will be made through the state payroll system. This is the only mechanism that will allow us to tax individuals properly and to apply treaty exemptions to eligible non-resident aliens. All state travel reimbursements for honoraria recipients will be processed in Travel Services. Accounts Payable will process all other honoraria claims through the state voucher system utilizing temporary service funding.

According to the guidelines from the Office of the State Comptroller (OSC), the proper object code for honoraria payments is 2800. Therefore all honoraria payments will be processed using this code from temporary service monies.

OSC guidelines further indicate that a justification is required when processing honoraria payments for over $500 per day. For that reason, it is important to accurately indicate the dates of service. When payments calculate to over $500 per day, excluding travel reimbursement, a short justification is required to substantiate the expenses. This can be done directly on the honoraria form either under Section IV Description of Services Performed or Section V Dates of Service.

Background

For several years, the University at Buffalo (UB, university) has processed honoraria payments for citizens, resident aliens, and non-resident aliens through Procurement Services when state funds are used. Honoraria payments to non-resident aliens have come under close scrutiny by the IRS. Therefore, the need to implement a change in the method of payment to non-resident aliens has become a priority.

It was necessary to review the current payment process for non-resident aliens because:

  • UB may be subject to fines and penalties by the IRS.
  • Federal guidelines regarding tax treaties are not currently followed under the current procedure.
  • U. S. taxes are not withheld from non-resident aliens who may be liable for payment.
  • Non-resident aliens incorrectly receive an IRS 1099 form at the end of the calendar year. (The correct form is a 1042S).
  • Since September 11, 2001, immigration rules and regulations are being strictly enforced.

Contact Information

Amanda Maines
International Employment Unit
120 Crofts Hall
Buffalo, NY  14260
Phone:  716-645-4429
almaines@buffalo.edu

Related Information

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