Salaried Postdoctoral Fellow vs Stipendee Postdoctoral Fellow
As a salaried postdoctoral fellow, you are paid from a research grant or funds designated as salary from which taxes are withheld by the University. As a stipendee postdoctoral fellow, you are paid from a fellowship award (NRSA, training grant, non-federal fellowship, etc) from which taxes are not withheld from your paycheck. If you are moving from Salaried Postdoc to Stipendee Postdoc, your tax and benefit status will change as follows:
- There are tax implications to you with this change. The tax implications will differ depending on your US tax status. If you are a US Citizen or Resident alien for U.S. tax purpose, the University will no longer withhold tax from your non-employee fellowship payments. Therefore, you should consult your personal tax advisor to determine whether or not you should be making estimated quarterly tax payments with respect to your fellowship income. Although the University will not withhold taxes from your check, your fellowship payment (plus institutional allowance when applicable) is taxable for federal and MA income taxes. However, your fellowship award payments are not subject to Social Security (FICA) and Medicare taxes.
- Subsequently, you will not receive a W2 or a 1099 as the University is not required to report or issue formal tax documents for fellowship amounts for US citizens or residents. You can use the YTD amount from your December paystub to prepare your personal tax return. You will need to add in the employer paid portion of the benefits designated with an "RE".
- Your benefits (health, dental, etc) are no longer pre-tax deductions, but they are now post-tax deductions. In addition, the amount of money Harvard pays for your benefits will now be considered imputed income, and the dollar value of Harvard's portion will be added to your taxable gross income (for nonresidents for U.S. tax purpose only).
- There are benefit implications to you as a stipendee postdoctoral fellow. The Benefits Office will automatically send a notification of your benefit changes to your home address. As a stipendee postdoc fellow, you will no longer be eligible for Flexible Spending accounts (FSA). Additionally, you will no longer be eligible to make contributions to the Tax Deferred Annuity (TDA) retirement plans. For further information please call the Harvard University Benefits Office at 617-496-4001 or e-mail them at email@example.com.
Pleae contact Harvard University Financial Services - Customer Relations (617) 496 - 8500, option 5, for further questions regarding US tax classification, Tax treaty benefits, FICA exemptions, fellowships, loan forgiveness and various tax forms.