Certificate as wages

drehil · March 2007

I would like to give a $50 certificate to an employee being selected "Employee of the Month". This is our first time giving out this award. My accounting department is telling me I have to include this a part of their wages and tax it through payroll. Does this sound right?

marc · March 2007

Yes, it is taxable.

NaeNae55 · March 2007

Generally you can give a gift with a value of up to about $25 without having to report it to Uncle Sam. Any amount given in cash (or equivalent) is taxable.

Good luck!

Nae

C Wilson · March 2007

Yes, It is taxable but we gross up the amount to cover the taxes. So $50.00 = $50.00 net.

Dutch2 · March 2007

We do the same as C Wilson. We gross up the amount to ensure the ee nets the correct amount, such as $50.00.

Certificate as wages

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