When are royalty payments made to inventors?

Royalty payments to inventors are processed two times in the calendar year. The first payment is made from late May to mid-June. The second payment is made from late October to early November.



What do the payments represent?

The payments represent the inventor´s share of royalty payments from licensees to the NIH during the fiscal year. For example, the first inventor payment is based on money received by the NIH for the period of October 1 through March 31. The second inventor payment is based on money received by the NIH for the period of April 1 through September 30.



How are the royalty payments calculated?

Inventors receive the first $2,000 received from a licensee. Next, they receive 15 percent of royalties received above $2,000 up to $50,000. Finally, they receive 25 percent of royalties in excess of the first $50,000 received each year. Each inventor cannot receive more than $150,000 in royalty payments for a calendar year.



How are the payments made to inventors?

The payments are made by either direct deposit to the inventor´s financial institution or by check.



What do I do if I move or change financial institutions?

MESSAGE TO INVENTORS: If you move, or change financial institutions, you must notify Johanna Grodzicki or Sandra Waddy of these changes. This is your responsibility. Checks mailed to old addresses are returned to the U.S. Treasury. Direct deposits to an old account number at your previous financial institution are also returned to the U.S. Treasury. This will cause a delay in receiving your royalty payment.



Is there a preferred method of inventor payment?

All payments should be made by direct deposit.

In order to ensure that inventor royalty income is deposited to the correct account, inventors are required to complete the ACH VENDOR/MISCELLANEOUS PAYMENT ENROLLMENT FORM at http://www.ott.nih.gov/pdfs/SF3881-ROYALTIESONLY.PDF and return to the address below or otherwise provide the information requested on the form to the same address.

How do I identify a deposit in my bank account as a royalty payment?

Royalty payment transactions sent from the NIH to the U.S. Treasury include the words ROYALTY PAYMENT. When the Treasury sends this information to your financial institution, the ROYALTY PAYMENT identification is included with the direct deposit transaction. Most institutions include this information on your monthly account statement. However, some institutions do not interpret or provide the payment description. Others choose not to provide the description. If the deposit identification does not appear on your statement, you should discuss this matter with your financial institution.



Are taxes withheld from the royalty payments?

The answer is no.



Will I receive a tax statement for royalty payments?

If you receive royalty payments of $10.00 or more in the calendar year, you will receive Form 1099-MISC Miscellaneous Income. Payments for less than $10.00 are taxable, but Form 1099-MISC will not be issued.



If I received a check, and don't cash it, what happens? Maybe I lost it, or misplaced it in my home.

The U. S. Treasury automatically cancels checks that are not cashed after one year from issuance. When this occurs, funds are returned to the issuing agency. Once returned, the NIH has less than four years to reissue these amounts.



Are royalties distributed to the estate of a deceased inventor?

Yes, royalties will continue if an inventor is deceased. The payments will be issued "To The Estate of ...." and forwarded to the bank account or address on record with the Office of Financial Management. The Personal Representative for the Estate should contact Karen Rogers, Senior Royalties Administrator at 301-435-4359, or by e-mail, for assistance regarding probate issues and disposition of future royalties to estate heirs. She will coordinate interactions with the Office of Technology Transfer, Office of Financial Management and the Office of General Counsel.



Whom should I contact when I have questions?

Payments: If you have a question about a royalty payment you have received, contact Johanna Grodzicki, the OFM Royalty Coordinator at 301-451-6337, or by e-mail. Other royalty staff members that may be able to assist are Sandy Waddy at 301-402-5279, or by e-mail.

Estate or Probate Issues: If you are the Personal Representative of an Inventors Estate contact Karen Rogers, the Senior Royalties Administrator at 301-435-4359, or by e-mail.

Technology Transfer Matters: For questions concerning technology transfer matters inventors may contact their institute Technology Development Coordinator, who has overall responsibility for institute technology transfer. These personnel are available to assist in all phases of the process required to establish Cooperative Research and Development Agreements (CRADAs), Material Transfer Agreements (MTAs) and Employee Invention Report (EIRs). They also serve as the Institutes and Centers (ICs) liaison with the Office of Technology Transfer and the Office of the General Counsel on technology transfer matters. A list of current Technology Development Coordinators can be found here. Questions concerning the status of a specific license agreement or its underlying patents or patent applications may also be obtained by contacting the Office of Technology Transfer.