TSS - What is an Honorarium Payment and How Does One Get Paid?

What is an Honorarium Payment and How Does One Get Paid?

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First Published  :Fri Nov 21 17:24:58 GMT 2014
Last Modified  :Wed Jun 01 20:34:55 GMT 2022
Last Published  :Wed Jun 01 20:34:55 GMT 2022
Summary :  Definition of honorarium and process to have a payment made.

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    An honorarium is a token payment made to bestow recognition to an individual for services they perform, for which payment is not required.  Typically, an honorarium is issued when custom or propriety forbids a price to be set.  Therefore, payment to the recipient is at the discretion of the payer.  The arrangement between the recipient and the university is informal and does not require a contract.  Because payment is not required, honorarium recipients do not provide an invoice to the university.

    Departments paying an honorarium should use the Electronic Check Voucher system in PeopleSoft.  The process will require supporting documentation be attached, such as a letter of invitation, letter of acceptance, announcement or advertisement.  Payees, if not already in our Accounts Payable database, will be sent a PaymentWorks invitation for onboarding.  Payees must complete this process in order to become a vendor in our system.  If the recipient of the honorarium has incurred travel expenses which will be paid by Tufts, receipts may be uploaded during the same honorarium process. The IRS rules state that undocumented travel expenses will indeed be taxed but travel with receipts are not taxed.  


    Honorariums are considered taxable income by the IRS. Tufts does not withhold taxes to US Citizens and Resident Aliens.  As a general rule, payments made to non-resident aliens (NRAs) through A/P for honorarium are subject to a 30% withholding unless the tax rate is reduced or eliminated by the presence of a tax treaty.  A NRA should obtain an Individual Tax Identification Number (ITIN) for payment purposes (complete IRS W-7).  Without that number, a treaty benefit can not be claimed. See Also What is an ITIN?

    The Visa Waiver Program (VWP) allows citizens of participating countries to travel to the United States without a visa for stays of 90 days or less, when they meet certain requirements.  Travelers must be eligible to use the VWP and have a valid Electronic System for Travel Authorization (ESTA) approval prior to travel.  Individuals present under the VWP are eligible to receive honorarium payments.  They are treated as if they have a B1 Visa and therefore, must complete the same requirements (Alien Payment and B1 form).  Please click here for more information.

    Please note that honorariums are paid for non-Tufts employees only.  If one department wishes to pay an individual from another department, this must be done via supplemental pay through Payroll.

    If a payment must be international, a wire payment form can be used.

     

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