Ruth L. Kirschstein National Research Service Award, NRSA, institutional research training grants, training grants, stipend supplementation, compensation, other income, concurrent benefits, educational loans or GI bill, NIH loan repayment program, LRP, taxability of stipends, Form 1099

11.3.10 Stipend Supplementation, Compensation, and Other Income

11.3.10.1 Stipend Supplementation

Recipients may supplement stipendsA payment made to an individual under a fellowship or training grant in accordance with pre-established levels to provide for the individual's living expenses during the period of training. A stipend is not considered compensation for the services expected of an employee. from non-Federal funds provided the supplementation is without any additional obligation for the trainee. An organization can determine what amount of stipendA payment made to an individual under a fellowship or training grant in accordance with pre-established levels to provide for the individual's living expenses during the period of training. A stipend is not considered compensation for the services expected of an employee. supplementation, if any, will be provided according to its own formally established policies governing stipendA payment made to an individual under a fellowship or training grant in accordance with pre-established levels to provide for the individual's living expenses during the period of training. A stipend is not considered compensation for the services expected of an employee. support. These policies must be consistently applied to all individuals in a similar training status regardless of the source of funds. Federal funds may not be used for stipendA payment made to an individual under a fellowship or training grant in accordance with pre-established levels to provide for the individual's living expenses during the period of training. A stipend is not considered compensation for the services expected of an employee. supplementation unless specifically authorized under the terms of the program from which funds are derived. An individual may use Federal educational loan funds or VA benefits when permitted by those programs as described in Educational Loans or GI Bill below. Under no circumstances may PHS funds be used for supplementation.

11.3.10.2 Compensation

NIH recognizes that student or postdoctoral trainees may seek part-time employment coincidental to their training program to further offset their expenses. Fellows and trainees may spend on average, an additional 25% of their time (e.g., 10 hours per week) in part time research, teaching, or clinical employment, so long as those activities do not interfere with, or lengthen, the duration of their NRSA training. Funds characterized as compensation may be paid to trainees only when there is an employer-employee relationship, the payments are for services rendered, and the situation otherwise meets the conditions of the compensation of students as detailed in Cost Considerations-Allowability of Costs/Activities-Selected Items of Cost-Fringe Benefits / IHE Tuition/Tuition Remission in IIA. In addition, compensation must be in accordance with organizational policies consistently applied to both federally and non-federally supported activities and must be supported by acceptable accounting records that reflect the employer-employee relationship. Under these conditions, the funds provided as compensation (salary, fringe benefits, and/or tuition remission) for services rendered, such as teaching, laboratory assistance, or clinical duties are not considered stipendA payment made to an individual under a fellowship or training grant in accordance with pre-established levels to provide for the individual's living expenses during the period of training. A stipend is not considered compensation for the services expected of an employee. supplementation; they are allowable charges to Federal grants, including PHS research grants. However, NIH expects that compensation from research grants will be for limited part-time employment apart from the normal full-time training activities.

Compensation may not be paid from a research grant that supports the same research that is part of the trainee's planned training experience as approved in the Kirschstein-NRSA institutional research training grant application.

StipendA payment made to an individual under a fellowship or training grant in accordance with pre-established levels to provide for the individual's living expenses during the period of training. A stipend is not considered compensation for the services expected of an employee. Supplementation & Compensation. Under no circumstances may the conditions of stipendA payment made to an individual under a fellowship or training grant in accordance with pre-established levels to provide for the individual's living expenses during the period of training. A stipend is not considered compensation for the services expected of an employee. supplementation or the services provided for compensation interfere with, detract from, or prolong the trainee's approved Kirschstein-NRSA training program. Training PD/PIs must approve all instances of employment on research grants to verify that the circumstances will not detract from or prolong the approved training program.

11.3.10.3 Other Income: Concurrent Benefits

An individual may not receive support under a Kirschstein-NRSA institutional research training grant concurrently with another federally sponsored fellowship or similar Federal award that provides a stipendA payment made to an individual under a fellowship or training grant in accordance with pre-established levels to provide for the individual's living expenses during the period of training. A stipend is not considered compensation for the services expected of an employee. or otherwise duplicates provisions of the Kirschstein-NRSA award.

11.3.10.4 Other Income: Educational Loans or GI Bill

An individual may accept concurrent educational remuneration from the VA (GI Bill) and Federal educational loan funds. Such funds are not considered supplementation or compensation. In the case of the MARC-U*STAR program, funds from a Pell grant may be accepted as well.

11.3.10.5 Other Income: NIH Loan Repayment Program

Postdoctoral trainees also may be eligible to participate in the NIH Loan Repayment Program. Information about this program is available at http://www.lrp.nih.gov/.

11.3.10.6 Taxability of Stipends

Section 117 of the Internal Revenue Code (26 U.S.C. 117) applies to the tax treatment of scholarships and fellowships. Degree candidates may exclude from gross income (for tax purposes) any amount used for qualified tuition and related expenses, such as fees, books, supplies, and equipment, required for courses of instruction at a qualified educational organization. Nondegree candidates are required to report as gross income any monies paid on their behalf for stipendsA payment made to an individual under a fellowship or training grant in accordance with pre-established levels to provide for the individual's living expenses during the period of training. A stipend is not considered compensation for the services expected of an employee. or any course tuition and fees required for attendance.

The IRS and Treasury Department released regulations in January 2005 (Revenue Procedures 2005-11) clarifying the student exception to the FICA (Social Security and Medicare) taxes for students employed by a school, college, or university where the student is pursuing a course of study. NIH's understanding is that these final regulations do not apply to or impact Kirschstein-NRSA programs or awards.

The taxability of stipendsA payment made to an individual under a fellowship or training grant in accordance with pre-established levels to provide for the individual's living expenses during the period of training. A stipend is not considered compensation for the services expected of an employee. in no way alters the relationship between Kirschstein-NRSA trainees and recipient organizations. Kirschstein-NRSA stipendsA payment made to an individual under a fellowship or training grant in accordance with pre-established levels to provide for the individual's living expenses during the period of training. A stipend is not considered compensation for the services expected of an employee. are not considered salaries. In addition, trainees supported under Kirschstein-NRSA institutional research training grants are not considered to be in an employee-employer relationship with NIH or the recipient organization solely as a result of the Kirschstein-NRSA support. Interpretation and implementation of the tax laws are the domain of the IRS and the courts. NIH takes no position on what the status may be for a particular taxpayer, and it does not have the authority to dispense tax advice. Individuals should consult their local IRS office about the applicability of the law to their situation and for information on their tax obligations.

11.3.10.7 Form 1099

Although stipendsA payment made to an individual under a fellowship or training grant in accordance with pre-established levels to provide for the individual's living expenses during the period of training. A stipend is not considered compensation for the services expected of an employee. are not considered salaries, the funds are subject to Federal and, sometimes, State taxes. The recipient organization may report such funds on IRS Form 1099, Statement of Miscellaneous Income. Normally, the business office of the recipient organization will be responsible for annually preparing and issuing the IRS Form 1099 for trainees. Recipient organizations are not required to issue the Form 1099, but it is a useful form of documentation of funding received and it serves as a reminder to the trainee that some tax liability may exist. Even if the recipient organization does not issue the Form 1099, trainees are required to report Kirschstein-NRSA stipendsA payment made to an individual under a fellowship or training grant in accordance with pre-established levels to provide for the individual's living expenses during the period of training. A stipend is not considered compensation for the services expected of an employee. as income.