Wages and Taxes

Interns and trainees who receive a stipend as part of their training program are generally paid on the same schedule as other employees – weekly or bi-weekly – either by check or direct deposit into their bank account. An intern or trainee must be paid as a regular employee and cannot be paid as an independent contractor (i.e. using IRS Form 1099-Misc).

Interns and trainees are required to pay some but not all taxes paid by U.S. citizens.

Interns and trainees must pay:

  • Federal income tax
  • State income tax
  • Local or city income tax (if applicable)

Interns and trainees do not pay:

  • Social Security and Medicare tax (FICA)
  • Federal unemployment tax (FUTA)


At the end of the tax year, host organizations must send IRS Form W-2 to interns and/or trainees who were paid. If an intern’s or trainee’s program takes place in two or more tax years, you must send a W-2 each year. Be sure to collect and confirm your intern’s and/or trainee’s home address before their program ends; that way you can mail their W-2 even if they have already left the country. (Alternatively, if your organization uses an online system to distribute W-2s, confirm that your interns and/or trainees have and retain access even after they leave the U.S.)


All interns and/or trainees must apply for a Social Security number unless they already have a Social Security number from a previous visit to the United States. Applying and processing of Social Security applications can take several weeks; however, it is legal for your intern and/or trainee to start their program during this waiting period.


If FICA/FUTA has been withheld from your intern’s or trainee’s paycheck by mistake, you will need to change withholding taxes for all future paychecks and remind your intern or trainee to claim a refund when filing their federal tax return. (See instructions for IRS Forms 941 and/or 944 for more information).