Per Diem and Fees
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A consultant or contractor is a firm or an individual offering professional or specialized services for a fee. When the University is required to make payments to individuals, the regulations of several governmental regulatory bodies must be considered. A determination must be made (by the department/unit because of the familiarity of the relationship) to ensure that payments to individuals for services meet the Internal Revenue Service's standards for classification as an independent contractor. The regulations of the IRS and the Immigration and Naturalization Service with respect to non-resident aliens must also be followed. Any individual who performs services for the University is presumed to be an employee unless the relationship satisfies the IRS standards for classification as an independent contractor. An independent contractor (consultant, instructor, etc.) should be used only when the services are not readily available from existing employees or where the services cannot be performed more economically or satisfactorily through the employment process. The IRS's general rule is that "an individual is an independent contractor if (the person for whom the services are performed) has the right to control or direct only the result of the work, and not what will be done and how it will be done or method of accomplishing the result." Additional information can be obtained from the Internal Revenue Service's website. An individual performing personal service must be treated as an employee if the answer to any of the following questions is "yes."
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