Stipends and honorariums are different in scope and business use. These terms are not interchangeable.
A stipend is a fixed regular sum of money paid at regular intervals. It is an allowance to help cover basic costs while receiving career training. Stipends have a non-compensatory requirement and therefore cannot be payment for services (ie, employment, independent contractor). Example – a small sum of money paid to a graduate teaching assistant by the school to cover living expenses.
Federal and State laws can affect how the university conducts business. Here you will find guidance on how tax laws affect stipends available to NC State and its employees. Also, refer to the chart of accounts 5696X – 5697X for a listing of stipend expense accounts.
The word “stipend” is not a term recognized by the Internal Revenue Service.
An honorarium is defined as a payment of money, or another thing of value, to a person for her/his participation in a usual academic activity for which no fee is required. An honorarium is not a salary nor any other compensation for services rendered on a continuing basis.
- It is a token of appreciation, in lieu of payment for services rendered by professional persons.
- An honorarium includes substantiated travel and expense reimbursements.
- The department receiving the service determines the appropriate amount to pay the professional person for the service.
“Usual academic activity” includes lecturing, teaching, and sharing knowledge. Refer to the chart of accounts for a listing of honorarium expense accounts (5195X-Honorarium Payments to Professional Persons).
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