Safeway gift card

[Payroll]

What is the name of your state (only U.S. law)? California:
My company plan to give out the $25 safeway gift card to each employees (1,500) for Thanksgiving. we do this annually, will the gift card be taxable and need to be posted to employees W2s?

Thank you

 

[tranquility]

Only if accounting for it would be unreasonable and administratively impractical.

That is the definition de minimis and where the amount would not be processed through the employees W-2. There really isn't a dollar figure and the area is a little fuzzy.

In this case, if *everyone* is getting the same amount, I'd say it is wages. Sorry. But, if it's not to be put on the W-2, i'd have some argument ready which will fit the above definition.

 

[adjusterjack]

My company plan to give out the $25 safeway gift card to each employees (1,500) for Thanksgiving. we do this annually, will the gift card be taxable and need to be posted to employees W2s?

According to the IRS:

Gift certificates

Cash or cash equivalent items provided by the employer are never excludable from income. An exception applies for occasional meal money or transportation fare to allow an employee to work beyond normal hours. Gift certificates that are redeemable for general merchandise or have a cash equivalent value are not de minimis benefits and are taxable.

A certificate that allows an employee to receive a specific item of personal property that is minimal in value, provided infrequently, and is administratively impractical to account for, may be excludable as a de minimis benefit, depending on facts and circumstances.

https://www.irs.gov/government-entities/federal-state-local-governments/de-minimis-fringe-benefits

It appears that the $25 gift certificate should be reported on the employee's W-2 unless it's redeemable for just one item.

Your employer should confer with his tax pro.

 

[quincy]

This thread is from October 1, 2009.

“Tranquility” hasn’t been on the forum since 2016, which is a good clue that a thread is old.

Reporting spam AND labeling a thread with its posting date can help prevent others from posting. Also, adding a post (like this one) immediately after reporting spam, and then deleting it after the spam post has been reported, will send the thread back to the archives (IF no one else has responded in the meantime).

 

[Taxing Matters]

This thread is from October 1, 2009.

Why is that my post which pointed out this thread was 11 years old was deleted?

 

[quincy]

Why is that my post which pointed out this thread was 11 years old was deleted?

I don’t know. The moderator also deleted Blue’s post.

Perhaps the moderator thought my post, with the bolded date, would better prevent any additional postings? If that was the reason, it obviously didn’t work.

This thread is from 2009.