Effective September 1, 2015
Awards, gifts and prizes may be necessary to carry out the mission of the College.
The use of awards, gifts, and prizes for student or employee incentives or awards is generally acceptable if related to our mission as determined by the department or program administrator. Such awards must comply with any funding source restriction and cannot be lavish or extravagant. Under IRS Regulations (2015 IRS Publication 15-B page 8), awards, gifts, and prizes are taxable to the recipient and must be reported as income on either an IRS form W2 for employees or 1099-MISC form for non-employees.
Gift card(s) can be purchased as needed following normal AC procedures for purchases and receipt handling. When the card is distributed to the student, employee or other individual, an prize_acknowledgement.pdf form must be completed and routed to the Business Office for processing. In the event cards are given as an incentive to a group of students, a sign-in sheet may be used as long as it includes 1) the student’s name, 2) student ID #, and 3) the $ value of the card given per individual.
Proper classification of payments is necessary to differentiate between those considered scholarships, which may be tax-free, and those that are awards, gifts, or prizes, which may be taxable. Purchases of these cards should be coded to either institutional support (528700), or promotional advertising (528130) in most cases.