Related policies and additional references:
This policy outlines acceptability, sets maximum value, and discusses the tax implications of awards/prizes and gifts to employees and students. As with all expenditures, anyone making purchases with University funds is obligated to use stewardship, exercise ethical behavior, comply with government regulations, and provide proper transaction documentation and recording.
Departments often look for ways to recognize and show appreciation to employees or students for outstanding work-related achievements, significant contributions, major milestones, or to encourage participation in particular programs by offering awards/prizes. Cash and gift cards are discouraged due to tax consequences for the recipient and the University.
Generally, awards/prizes should be non-cash items meeting the following criteria:
- Maximum value of $50
- Within budget availability
- Approved in advance by the area Vice President, addressing criteria, consistency, and fairness
- Documented with a signature from the recipient
Awards/prizes to students for organized competitions or similar academic recognition may have federal financial aid reporting implications. Accordingly, any item to be given to a student with a value greater than $50 must be cleared through the Office of Financial Assistance prior to award.
Gifts to employees or students for non-work related occasions such as birthdays, weddings, Christmas, showers, or similar events are not permitted to be purchased or reimbursed with University funds.
Expressions of sympathy and support for employees or students must be consistent with principles of good stewardship and appropriate to the situation, with the knowledge that University resources are substantially funded by student tuition. Examples of such support include death, serious illness or hospital stays for employees, students, or immediate family members.
Regardless of the value, cash or gift cards awarded to an employee or student are taxable and subject to either payroll tax withholding (federal withholding, FICA, Medicare) and W-2 reporting for employees or Form 1099 reporting for students.