​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​About ​Royalties ​

The Royalty team is specifically responsible for managing royalty income from licensees for scientific research programs within NIH Institutes and Centers (ICs). Their duties include ensuring accurate collection and allocation of funds, calculating income, processing semiannual royalty payments to inventors and technology partners, perform income and payment reconciliations and prepare tax documents for inventors.

Additionally, the team disperses Federal Technology Transfer Award payments annually. These cash awards recognize scientific, engineering, and technical personnel for outstanding contributions in inventions, innovations, computer software, or other significant scientific and technological advancements benefiting the United States. — NIH Policy Manual, 2300-451-1: NIH Employee Awards Program

Frequently Ask Questions

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1. How are the royalty payments calculated?

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

Royalty payments to inventors are processed two times in a calendar year. The first payment is generally disbursed in late May to late June. The second payment is generally made between late October to late November. Payments cannot be distributed to inventors until the royalty information is completely reconciled to ensure accurate payouts.
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3. How are the payments made to inventors?

Payments are made electronically by direct deposit or wire transfer and in some instances by check.
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4. When can I expect my tax form?

Tax forms are generated and mailed out to the inventors by January 31st and reported to the IRS.
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5. ​Will taxes be withheld from my royalty or Federal Technology Transfer payments?

No, the Office of Financial Management does not withhold taxes. For any questions regarding paying taxes, please visit the Internal Revenue Service’s (IRS) website or contact a tax advisor for assistance.
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6. Why didn’t I receive my tax document?

You may not have received your tax document if your payment did not meet the IRS-required reportable income threshold. For FTT Awards, OFM does not issue 1099 tax documents or payments for amounts under $600. Additionally, if your address was not updated, this could have also prevented you from receiving your 1099 form.

Important Links​

Information for NIH Inventors
HHS Tech Transfer Offices & Contacts
PHS Technology Transfer Policies

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