Fellowship or stipend payments can be paid through the payroll system, but since these payments are not made because of an employment relationship, payments to recipients who are U.S. citizens and resident aliens are not subject to federal and state income tax withholding and payroll taxes (i.e., FICA and Medicare taxes). The university has no tax reporting requirement for these payments, although recipients should be aware that these payments may be taxable income. The interpretation and implementation of the tax laws are the domain of the IRS and the courts.
Nonresident alien recipients of fellowship or stipend payments are subject to federal tax withholding, and the university is required to report the information annually to the recipient and the Internal Revenue Service (IRS) on federal Form 1042-S.
Employee Services - International Employee