Research Subject Incentives

Owned by Chad
Last updated: Jun 14, 2021

Corresponding Policy: See ‘Human Subjects Research Review’ policy
Corresponding Forms: Operating Advance Request Form, Incentive Payment Distribution Log, Monthly Incentive Reconciliation Form, Miscellaneous Deposit Form, Personal Reimbursement Form
Process: Finding out the Process for Requesting and Reconciling Operating Advances for Research Incentives

Business Requirements
This procedure provides guidance and direction for acquiring and accounting for operating advances. Operating advances are used for payments made to individuals as an incentive to participate in a research study sponsored by the University, herein after referred to as "Research Subject Incentive Payments."  Operating advances are used to purchase gift cards or cash payments to participants.  This procedure is in place to meet the needs of the research community, minimize the administrative burden, and comply with federal and tax reporting requirements.

  1. Stakeholders & Business Units
    Principal Investigators (PI) and others conducting research, Departmental Research Administrators (DRA), Departmental Finance Managers, Sponsored Projects Administration (SPA), Office of Research Integrity (ORI) and University Financial Services (UFS).
  2. Purpose and Use of Gift Cards or Payments to Research Participants
    The University often conducts research where there is a requirement to obtain participation and/or collect information from participants. Researchers frequently find it necessary to offer incentives in order to obtain sufficient participation. Gift cards or cash may be used within the established guidelines to facilitate making payments to participants in research studies. These incentives are subject to Internal Revenue tax laws and there are specific rules that must be followed in order for the University to remain in compliance. Gift Cards are for the sole purpose of participant payments and cannot be used to pay trade suppliers for goods and/or services received and/or rendered or pay any type of wages for services rendered.
  3. Process to Acquire an Operating Advance
    The Principal Investigator (PI) or designee will:
    1. Complete an Operating Advance Form for an amount to cover disbursements of incentives for a 60 day period in accordance with the approved HRSCC protocol [See Human Subjects Research Review Policy- for information regarding HRSCC approval of research protocols involving human subjects]. The Advance can be used for cash payments to participants or to purchase gift cards for disbursement to participants. A separate Operating Advance Form is required for each sponsored project or project funded by departmental or other University sources.  
    2. Submit for approval to (1) Department Head, (2) SPA and (3) UFS Director’s office.  The UFS Director's office will forward approved Operating Advance Forms to Campus Accounting Services for processing. Campus Accounting Services will process payment for the approved Operating Advance. Paper checks will be cut once a week (on Wednesdays) and ACH direct deposits will be processed daily.  Checks are available for pick up at Market Center Building Ste. 260 after 4 p.m.
      The PI or designee can use the operating advance to purchase gift cards from any merchant as long as there is no conflict of interest, for example purchasing gift cards through known associate’s and/or program. Purchases must be made with a vendor that accepts returns of gift cards in the event that there are unused gift cards at the end of the project. The Original itemized receipt for the cards must be kept as support documentation and attached to reconciled reimbursement form to clear advance.
  4. Requirements for Maintaining and Distributing Cash and Gift Card Research Incentive Payments
    PIs and their designees are required to appropriately safeguard, account for and document all gift cards and cash. Gift cards are the same as cash and must be handled accordingly; ensuring adequate controls are in place to safeguard, store, and prevent loss.  Until disbursed, cards and cash should be maintained in a secure, locked device or some other location appropriately approved by the UFS for money storage.
    The following procedures are required for disbursing and accounting for incentive payments:
    1. An Incentive Payment Distribution Log must be used to control and account for all gift cards and cash acquired and distributed to participants.
    2. The Incentive Payment Distribution Log must be kept together with the gift cards and cash pending disbursement in a secured, locked boxed or some other location appropriately approved by the UFS for money storage.
      *Please note: if the cumulative amount distributed to one participant is greater than $600 within a calendar year a W-9 must be obtained and sent to Campus Accounting Services.
    3. At the beginning of each month, the PI or designee must perform a reconciliation of all gift cards and cash using the Monthly Incentive Reconciliation Form for all payments made during the previous month. The reconciliation should verify the physical inventory against the Incentive Payment Distribution log to verify that all gift cards purchased and undisbursed cash are either still present or have proof of distribution.  Any discrepancies must be logged on the Incentive Payment Distribution Log and brought to the attention of SPA and UFS.  Upon reconciliation, the PI should sign and date the Monthly Incentive Reconciliation Form. If no activity occurred during the month, the PI or designee should communicate this to SPA.
    4. PI or designee will then complete a Personal Reimbursement form and attach original proof of receipt/distribution, the Incentive Payment Distribution Log and Monthly Incentive Reconciliation. The Personal Reimbursement form will need to be signed by the PI and then approved by Department Head and sent to SPA. SPA will perform an audit of the documentation, detach/file original confidential receipts in the secured Research Participant Receipt File Cabinet in RSP, and forward to UFS to process.
    5. UFS will process the Personal Reimbursement form and will apply the amount reconciled against the advance.
  5. Acquiring Additional Advances
    1. Multiple Sponsored Projects using research incentives:  If a PI has multiple sponsored projects using research incentives, an advance for each sponsored project should be requested and separately accounted for. Gift cards purchased with an advance for one sponsored project, should not be distributed on another sponsored project as the tracking for the gift card serial numbers will be jeopardized. See the instructions below in 6.  “Closing an Advance with Research Incentive Payments” addressing unused gift card inventory or remaining cash.
    2. Multiple Advances on a single Sponsored Project:  An open advance for a sponsored project is expected to be closed before another operating advance is requested for the same project. If there is a need for more than one open advance on the same sponsored project, the PI should attach an explanation to the new Departmental Operating Advance Form, which will be subject to approval by SPA and UFS.
  6. Closing an Advance with Research Incentive Payments
    1. Advances must be closed out after one year of issuance. To close out an advance, complete steps 1-5 as outlined above under “Requirements for Maintaining and Distributing Research Incentive Payments”
    2. If there are unused gift cards on hand, return gift cards to the merchant and obtain a receipt for the refund issued. Indicate the refund on the reconciliation log.
    3. If there is unused cash or gift card refunds that need to be returned back to PSU, complete a Miscellaneous Deposit Form and bring cash/check for the amount due to the Departmental Services Window in Fariborz Maseeh Hall.
    4. Complete a Personal Reimbursement form and attach a final Incentive Payment Distribution Log, a final Monthly Incentive Reconciliation form, and all supporting receipts/documentation including a copy of the cashiers receipt if funds were returned and route to Department Head and SPA for approval.  Upon approval SPA will forward to UFS for reconciliation of the advance.

For process flow of advances and sample logs, please see below.