Honoraria Clarification

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Honoraria (Clarification)

This page clarifies some ambiguity concerning the payment of honoraria (and related travel expenses) to individuals in accordance with Section 40.2.5, Payments Made to Individuals for Consulting or Other Independent Personal Services, Intellectual Property, Honoraria and Other Miscellaneous Activities of the University's Regulations & Procedures Manual.

Section A.4 (page 3) of the policy states, "the total cost of services indicated on the [consultant] form must include an estimate of out of pocket expenses, if any, to be paid to the individual in connection with the services rendered. These expenses will be considered as part of the fee paid to the individual and will be reported as such to the IRS." Recently, some questions have been raised as to whether this treatment applies to miscellaneous payments made to individuals for honoraria.

The following criteria should be applied when making honoraria payments, as well as reimbursements for traveling expenses, to visiting lecturers.

As outlined in Section B.3 (page 5) of the policy, "an honorarium is defined as a payment for personal services on which custom or propriety forbids a price to be set. Typically, honoraria are paid to guest lecturers or experts for brief appearances at the University."

If you are making an honorarium payment to a guest lecturer or expert for a brief visit, you may treat the individual's honorarium fee separately from his/her expense reimbursement; you do not have to combine both of these components into the honorarium fee. If you separate the honorarium from the travel reimbursement, the honorarium payment must be made in accordance with section B.3 and B.5 of the policy and the travel reimbursement must be in accordance with the University's travel policy, as amended by my memorandum dated September 24, 1996.

If you or the recipient of the honorarium prefer not to separately account for and report (on a TABER) traveling expenses. you may include this amount, or an estimate thereof, in the honorarium fee and process the single payment in accordance with section B.5 of the policy.

If honoraria payments are for large sums or for long periods of time, you should reassess whether the payment is truly an honorarium, or whether you are actually contracting a consultant to perform services. Section B.3 of the policy provides guidance in this regard and states that, "service arrangements providing for more extensive involvement on the part of an expert such as a program review requiring the preparation of a written evaluation, are to be treated as consulting arrangements." You will need to use judgment in these cases and if a consulting arrangement prevails, you will need to comply with Section A of the policy.

As always, honoraria payments made to employees, if and when appropriate, must be processed through the University's payroll system.

Payments for honoraria paid to nonresident aliens must continue to be prepared in accordance with Section C of the policy.