I have read the letters by Professor White of the Chemistry Department and Professor Tomazinis of City & Regional Planning concerning the Comptroller's practice of withholding 30% of the expense reimbursement of foreign scholars. They are not the first faculty member to experience embarrassment and frustration with this practice of the Comptroller.
A year ago I invited a scholar from Toronto to speak to a seminar and agreed to pay him a $200 honorarium and transportation. The University deducted 30% from both and sent him a check for less than his airfare. In March, I wrote Mr. Butler a letter questioning the payment. He replied that this was in compliance with the position of the IRS.
This deduction is not made in compliance with any IRS regulations; it was on the basis of only an "informal position," which has no legal effect. The University could question this "informal position" by requesting an opinion letter which could lead to fuller consideration by the IRS. If this failed, the University, joined by other educational institutions, could set up a test case to challenge the ruling in court. The Comptroller's Office did not indicate that it had made any effort to question this "informal position" of the IRS; it apparently just rolled over dead, accepting without protest what Mr. Butler characterized as "an unreasonable position."
It seems to me that the University, along with other educational institutions who are seriously affected, should immediately pressure the IRS to abandon its irrational "informal position," and if necessary, challenge it in court. The Comptroller's acquiescence it has done far too much damage already.
-- Clyde W. Summers, Professor of Law
-- Kenneth B. Campbell, Comptroller
Volume 43 Number 18
January 21, 1997
Return to Almanac's homepage.
Return to index for this issue.