The Tax Implications Of Clinical Trial Payments: Part 3

By Sam Whitaker, Founder and CEO of Mural Health, and Kelly FitzGerald, IRB Executive Chair and Vice President, IBC Affairs, WCG

A key focus of Part III in this clinical trial payment series is the tax implications of trial payments. This article emphasizes that while reimbursements for out-of-pocket expenses are tax-exempt and beneficial for participants, any additional payments are classified as taxable income, which may jeopardize participants' eligibility for social welfare programs. This tax burden can deter underrepresented populations from participating in clinical trials.

Explore the tax reporting requirements, noting that payments exceeding $600 necessitate a 1099 form, a threshold set to rise to $2,000 in 2026. It distinguishes between taxable stipends and non-taxable reimbursements, advocating for the latter to minimize financial strain on participants. The article advises that stipends should only be issued after all expenses are reimbursed and on an opt-in basis. It also encourages clear communication in consent forms regarding payment structures and tax implications. By prioritizing participant-friendly payment methods and providing resources for financial support, the series aims to enhance engagement in clinical trials and improve research outcomes.