According to IRS rules, payments can either be made to employees, independent contractors (IC) or human subjects. There is no other type of individual that can be paid. Thus, invited speakers, outside consultants of any type, outside advisors, outside paid reviewers, etc., must be paid as an IC.

If the PI is buying a one-time service, and the cost of the service is less than $600, then the IC will perform the service and submit an invoice. A consulting agreement is typically not required in such circumstances. If the service is recurring and/or costs $600 or more, then a consulting agreement should be in place to protect both parties in case something doesn't go according to plan.

A model consulting agreement that can be adapted for a given situation can be found here. In addition to a consulting agreement, two forms are needed before payments can be made to a consultant under a grant: the Independent Contractor Review Form (click on “Independent Contractor Review” to bring up Formatta form) to be filled out by the PI, and, if necessary, a W-9 form to be filled out by the person/organization receiving the payment. The following steps should be followed:

1. Prior to making arrangements with a potential IC, contact Research Services to initiate preparation of the consulting agreement (if needed) and to make sure the payment is allowable under the terms and conditions of the grant, especially on federal and federal flow through awards. Once the consulting agreement is fully executed, Research Services will send a copy to Sponsored Program Accounting (SPA) for their files.
2. Upon making arrangements with the IC, immediately obtain a W-9 form and provide it to the contractor requesting that the IC sign and return the W-9 form as soon as possible to assist in the speed of processing payments. NOTE: A W-9 form is not required if Accounts Payable already has assigned a vendor number to the IC: contact the Accounts Payable manager at (312) 915-8748 to see if a vendor number has already been assigned.
3. Submit an Independent Contractor Review Form on-line (click on “Independent Contractor Review” to bring up Formatta form). If applicable, be sure to check “yes” in item 7 and attach a copy of the consulting agreement.
4. Upon receipt of a request for payment from the IC, submit a check requisition, signed W-9 form (if necessary), and supporting documentation (original invoice, flyer or brochure with speaker's name, etc.) to Sponsored Program Accounting (SPA) for approval and processing through Accounts Payable.

1. Independent Contractor Review Form
2. Consulting Agreement
3. W-9