Participants will receive a stipend as support for their living and other expenses during this educational experience. Stipend rates are determined by CDC officials, and are based on the participant’s educational level. Stipends for faculty participants will be based upon their regular university salary.
Stipends for most ORISE participants are paid monthly and will be received on the final business day of the month.
ORISE strongly encourages participants to sign up for Electronic Funds Transfer (EFT), i.e., direct deposit, for stipend payments. To sign up, please download and complete the EFT Application form. EFT requires the participant to have a U.S. bank account; we cannot transfer funds to foreign institutions.
Health Insurance Deduction
Participants who enroll in the ORAU/ORISE health insurance plan can expect to have the monthly premium deducted from their stipend payment each month, which pays for health insurance for the following month (e.g., the premium for January coverage will be deducted in December). Participants who begin their appointment between the 1st and 15th of a month can expect to have two insurance premiums deducted from their first stipend payment (one to cover the current month and one to cover the following month).
Other Sources of Income
Because the educational benefits of the appointment are the primary focus of the program, the Participant may not provide services for compensation to a third party that conflict with the appointment. Awards, prizes, scholarships, Veterans Administration benefits, and other payments may be accepted by the participant provided they do not represent dual payment for the same activity.
Taxability of Stipends
Federal Income Tax
All stipend payments paid by Oak Ridge Associated Universities (ORAU) directly to the participant are considered taxable by the U.S. federal government and should be reported annually.
Because participants are not employees, stipend payments are not considered wages and should not be reported as such. Stipend payments are payments made to you in order to help defray living expenses while you are engaged in a research participation program at the CDC. For IRS purposes, these payments are considered non-qualified scholarships and fellowships (not tuition and fees). For instructions on how to report this amount on your federal tax return, refer to IRS Publication 970, Tax Benefits for Education, which you can download from www.irs.gov/formspubs or request at 1-800-829-3676.
Except for some foreign nationals, participants will have no Federal tax withheld by ORAU from their stipend payments. Participants who have no tax withheld by ORAU from their payments should consider filing Form 1040-ES on a quarterly basis and paying estimated Federal income taxes; this action will help you avoid being out of compliance with Federal regulations about the timeliness of tax payments.
Participants who have no tax withheld from their stipend payment can expect to receive an annual Statement of Payments letter from ORAU. Designed to help with your tax preparation, this statement will be sent to you by February and will include the total amount of payments made to you by ORAU during the previous calendar year.
Because stipend payments are awards (not wages), ORAU does not withhold Social Security or Medicare taxes for any participant. Participants are not self-employed, and therefore do not pay self-employment taxes. ORAU also does not withhold state income tax for any participant.
For more information on state tax liabilities and how to file federal tax forms, please contact a licensed tax professional in your jurisdiction. We recommend that you provide your tax preparer with a copy of your most recent Terms of Appointment.
ORAU’s Responsibility to Withhold Federal Taxes and Report to the IRS
For U.S. Citizens and Non-Citizens Participating in its Fellowship, Scholarship and Internship Programs
|Citizenship||Qualifying Condition||Withholds for Federal Income Tax||Reports to the IRS|
|Lawful Permanent Resident (Green Card Holder)||
|Foreign national who is considered a resident for tax purposes*||Tax treaty between the U.S. and country of tax residency||No||Yes (on form 1042-S)|
|Foreign national who is considered a resident for tax purposes*||No tax treaty between the U.S. and country of tax residency||No||No|
|Foreign national who is not considered a resident for tax purposes**||Tax treaty between the U.S. and country of tax residency||No||Yes (on form 1042-S)|
|Foreign national who is not considered a resident for tax purposes**||No tax treaty between the U.S. and country of tax residency||Yes||Yes (on form 1042-S)|
* A foreign national who meets the Substantial Presence Test and is, therefore, considered a resident of the U.S. for tax purposes
** A foreign national who does not meet the Substantial Presence Test and is, therefore, NOT considered a resident of the U.S. for tax purposes.