Expenditures of this type fall under Board Policy 260.1 for “Official Functions” designations and associated expenditures. Gifts to individuals are not allowed by Procurement Services, with the exception of “Promotional Items” as stated in OSP Promotional Items Policy and gifts in lieu of payment for services or awards that fall under one of the categories below:
- Research incentive
- Student award (i.e.: placed 1st, 2nd, 3rd, in Poetry contest)
- Drawing at an Athletic or Student Event (i.e., drawing a seat or ticket number)
Gifts to employees are not allowed. In most instances, employees will not qualify for a gift card, unless the employee has been picked as part of a research incentive or random drawing event such as an athletic event. If that is the case, the employee will be taxed on the gift card value through Payroll.
Employees who qualify for a gift card will be taxed through Payroll regardless of the dollar amount, other recipients will receive a 1099-MISC form IF the total amount of payments for the individual reaches a dollar amount of $600. If the total dollar amount a non-employee receives is less than $600, it is the responsibility of the individual to report these earnings.
Please note: If you have a winner of a prize or award that is not a U.S. Citizen or Permanent Resident, the award or prize must be made through Payroll or Accounts Payable in order to withhold the appropriate amount of federal tax. You will work with the team in Human Resources that works with Nonresident Aliens for U.S. Tax Purposes. You cannot give a gift card for a prize or award to a foreign national because of the required federal tax withholding.
The following items may be purchased with state-appropriated funds (OSP State Procurement memorandum):
- Plaques for student achievements.
- Plaques for board or commission members upon the termination of service on a board or commission.
- Promotional items specifically authorized by language in a state or federal grant.
- Items purchased, the cost of which is reimbursed by students.
Gift cards, shopping cards, and gift certificates are considered cash equivalents, therefore it is important that organizational units handle and account for these cards appropriately. Prior to purchase, written approval must be obtained from the Director of Procurement Services. Requests for approval to purchase gift cards, shopping cards, gift certificates, etc., should include:
- Number of cards or certificates needed
- Amount of the cards or certificates
- Their purpose and the event associated with the purchase (if applicable)
- Who will be receiving the cards or certificates (faculty, staff, students, etc.)
- Method of procurement (requisition or P-Card)
Requests are reviewed on a case-by-case basis and evaluated on the appropriateness of the request in support of the university/departmental mission.
NOTE: Personal reimbursements are NOT allowable methods of purchase for gift cards, shopping cards, gift certificates, etc. Reimbursement is not guaranteed for such purchases unless an exception was made by the Director of Procurement Services.
Upon approval, departments should enter a requisition in Workday, if using that method of procurement. The written approval and completed Gift Card Disbursement Form should be attached as supporting documentation.
If a P-Card is being used, then an itemized receipt for all gift cards/shopping cards/gift certificates must be attached to the corresponding transaction in Workday. The recipient’s acknowledgment of the gift card receipt (signature, e-signature, email, etc.) should be attached as additional supporting documentation. The memo must include the recipient’s name, the title of the event, and the date of gift card relinquishment.
A copy of all documentation should be retained in the department or by the cardholder and forwarded to the Director of Procurement Services within 5 business days after the event.