Services and Honorariums
Independent Contractor vs. Employee
A Guide to Properly Classify a Provider of Services
Which is it, an Independent Contractor or Employee? How do I determine which way they should be classified? Improper classification when addressing the Independent Contractor/Employee question can lead to serious consequences and penalties so understanding the differences is critical. The following documents are provided to assist with making a sound determination. As seen, even with these tools (provided by the IRS), this remains a subjective decision weighing many different factors.
- IRS Publication 1779 - Independent Contractor or Employee
- 20 Point Test - The IRS developed a 20-Factor Test to help
Who Can Receive an Honorarium?
Honorarium issued to an Employee
is defined as money or thing of value which is offered to a University employee for speech, appearance, article or similar function which is in connection with his or her official role at the University. An honorarium can only be accepted if it is specifically approved by the University and it is not on the prohibited list below. The University has an honorarium form to document the supervisory approval.
University employees may receive honoraria subject to the following limitations:
- The person, organization or company is offering the honorarium for a speech, appearance, article or similar activity in connection with the recipient's role at the University, and is not seeking or expected to seek contractual relations with Western Washington University; or
- The person, organization or company offering the honorarium is not regulated by Western Washington University; or
- The person, organization or company offering the honorarium is not seeking or opposing or is not reasonably likely to seek or oppose enactment or adoption of administrative rules or action or policy changes by Western Washington University; or
- The speech, appearance, article, or similar item or activity that the employee has been asked to give, produce or engage in does not detract from or interfere with his/her duties and obligations to Western Washington University.
See the following Policies and Procedures:
|PRO-U5400.19A||Requesting Approval To Accept Honoraria|
|POL-U5400.05||Using University Resources|
|POL-U5400.17||Professional Staff Policy on Consulting and Other Outside Compensated Professional Activities|
|POL-U5400.18||Faculty Policy On Consulting and Other Compensated Professional Activities|
|POL-U5348.12||Reimbursing For Official University Business|
|POL-U5348.09||Paying Honoraria To Non-Employees|
|POL-U5348.10||Authorizing and Reimbursing Travel For Official University Business|
Honorarium issued to a Non-Employee
Honoraria – Payments given in recognition of a special service or distinguished achievement when custom or propriety does not allow a fixed business price. Honoraria are paid to persons of scholarly or professional standing who do not represent a business enterprise and are not employees of the university.
Travel Expenses – Travel, lodging, and subsistence expenses incurred related to the event. Payments consisting solely of reimbursement of travel expenses for giving a speech or presentation should be processed as travel. (See Non-Employee Travel.)
However, The value of the honoraria should be established at an amount sufficient to cover the recipient’s travel expenses, if applicable. If travel is to be paid separately, a Performance/Service agreement must be created, and reimbursement for travel will be handled in accordance with POLU5348.10, Authorizing and Reimbursing Travel for Official University Business.
Honoraria are $599.99 or less and are not taxed by the IRS.
Requires a signature and SSN on a Services/Reimbursement Form.
Is intended to defray the cost of offering a service.
Honoraria may not be paid to a group, organization, or a company.