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Scope

Employees

NOTE: This revised policy is in accordance with IRS regulations and is in force pending review and approval by the Policy Committee and the Chancellor's Cabinet. Questions concerning this policy should be addressed to the Comptroller's Office.

Policy Statement

The Gift Disbursements Policy sets forth criteria and standards for:

• the use of University funds to purchase gifts;
• the specific values and types of gifts that may be given;
• the characteristics that make gifts taxable or non-taxable;
• the types of gifts that cannot be purchased with University funds; and
• the processing of gift purchases.

Gifts allowed to be purchased with University funds are limited to the following:

• Merchandise of nominal value
  • IRC Section 132(e) states that an employer may give a gift of nominal value to an employee on a tax-free basis if the gift is "merchandise of nominal value", however, the gift cannot be cash or a negotiable gift certificate.
    • The University has established a dollar value of $75 as nominal value; any qualifying gift to an employee in excess of $75 is taxable to the employee recipient.
  • Gifts of merchandise of nominal value can be purchased for the following types of activities or events:
    • Concern / sympathy gifts
    • Donor recognition gifts for stewardship and/or cultivation
    • Major life event recognition gifts (e.g., birth of a child)
    • Welcome or departure gifts
  • Gifts of merchandise of nominal value can be purchased for the following (based on one or more of the preceding types of activities):
    • Employees
    • Trustees
    • Donors
    • Volunteers
    • Hosts
    • Visiting dignitaries
    • Alumni
    • Charitable organizations
• Achievement and retirement gifts
  • IRC Section 74 states that an employer may give a gift to an employee as an achievement gift and it is not taxable to the employee if the gift meets each of the specific requirements detailed below in the section titled Syracuse University Recognition Program for Faculty and Staff Length-of-Service Awards.
    • An allowable achievement gift is a gift made under the Syracuse University Recognition Program administered by the Office of Human Resources.

The types of gifts that cannot be purchased with University funds include the following:

• A gift for recurring celebratory events (e.g., birthdays, holidays, anniversaries, etc.).
• A gift for non-retirement termination of employment.
• A gift from an individual University department to an employee for length of service.
• A gift to an unrelated individual or non-charitable entity (e.g., the UPS delivery person, a local group, etc.).

The gift policy does not cover the following:

• Ordinary business expenses, including occasional business lunches, office gatherings, or tickets for a table at an event, that are considered business expenses, and are addressed in the University's "Expenses, Reimbursement of" policy.
• A performance-based award or bonus, which is taxable to the employee recipient and is processed through payroll in accordance with IRS regulations.
• Cash gifts to any individual, employee or non-employee; all cash is considered remuneration and is therefore both taxable and reportable regardless of amount. All cash gifts must be processed through payroll for employees or through disbursements processing for non-employees.
  • Taxes on gifts to employees are withheld from the next payroll period's earnings.
  • Taxes on gifts to non-employees are not withheld, but reported to the IRS annually. Taxes on gifts to non-resident alien, non-employees may be withheld dependent on the terms of the applicable foreign tax treaty.

The gift policy does not preclude individuals from giving personal gifts to colleagues and/or to other individuals or entities, provided University funds are not used.

Nominal Gifts (Merchandise)

For an allowable gift to be nontaxable to the recipient the IRS regulations outlined below must be followed.

• Form of gift
  • The gift must be tangible personal property, i.e., merchandise. It may not be a check or a negotiable gift certificate (see non-negotiable gift certificate description following). Examples of gifts of tangible personal property include: flowers, books, candy, SU memorabilia, food baskets, art pieces, banners, etc.
• Dollar limit
  • The aggregate gift value of the merchandise should not exceed $75 per individual. If the value of the gift(s) exceeds $75, then the entire gift will be taxable to the recipient.
  • A non-negotiable gift certificate for merchandise in an amount not exceeding $75 will be considered nominal and nontaxable.
    • A non-negotiable gift certificate: (i) requires the recipient to exchange the certificate for tangible personal property from the issuing vendor; (ii) cannot be convertible to cash; and (iii) cannot be used to reduce the balance of the recipient's account with the company issuing the gift certificate.
  • gift certificate for services (e.g., for facials, massages, spa treatments, golf lessons, or to restaurants, etc.) does not qualify as tangible personal property and is taxable, regardless of the value.
• Frequency
  • The gift should be given only on an occasional non-recurring basis.
• Gifts of nominal value to non-employees
  • Gifts to non-employees, i.e., donors, trustees, alumni, charitable organizations, etc., can be authorized only by the Chancellor's Office; the Executive Vice President and Chief Financial Officer; the Office of Academic Affairs; the Office of Institutional Advancement; and/or the Secretary to the Board of Trustees. The processes, authorization limits and specified authorized signers within their respective offices for such gifts will be reported to the Comptroller by the Chancellor; the Executive Vice President and Chief Financial Officer; the Vice Chancellor and Provost; the Senior Vice President for Institutional Advancement; and the Secretary to the Board of Trustees.

A gift exceeding the dollar limit for a "nominal gift" of merchandise, or which is either a negotiable gift certificate or a gift certificate for services, will be fully taxed to the individual recipient. The Comptroller may make allowances on the dollar limit threshold for tax purposes, each occurrence of which will specifically be documented.

Concern / Sympathy Gifts

A concern / sympathy gift is allowable to both an employee and a non-employee if it meets one or both of the following points.

• Form of gift
  • A gift of tangible personal property, such as flowers or a food basket, may be presented as an expression of concern or sympathy in the event of an illness, hospitalization, surgery, or death of an employee, donor, trustee, alumnus, or to a member of their family.
    • The cost of such gifts is limited to the $75 nominal value to remain nontaxable. The authorizations for tangible personal property gifts to non-employees or non-employee family members requires the approval of the Chancellor; Executive Vice President and Chief Financial Officer; Vice Chancellor and Provost; Senior Vice President for Institutional Advancement; and/or the Secretary to the Board of Trustees, in accordance with the specifications outlined in their annual authorization to the Comptroller (i.e., processes, authorization limits, and specified authorized signers within their respective offices).
• Charitable contribution
  • A cash contribution may be made to a charitable organization in lieu of a gift of tangible personal property. Such contributions must be made by University check and be accompanied by a transmittal letter on official University letterhead, stating that the donation is made on behalf of the University. Contributions may not be made to any non-charitable organization or to any political campaign, political party, committee or group engaged in any attempt to influence the general public with respect to legislative matters, elections or referendums.
    • Charitable contributions are limited to $75.
    • Charitable contributions for non-employees or non-employee family members require the approval of the Chancellor; Executive Vice President and Chief Financial Officer; Vice Chancellor and Provost; or Senior Vice President for Institutional Advancement.

A gift exceeding the dollar limit for a "concern / sympathy gift" will be fully taxed to the individual recipient. The Comptroller may make allowances on the dollar limit threshold for tax purposes, each occurrence of which will specifically be documented.

Syracuse University Recognition Program for Faculty and Staff Length-of-Service Awards

This University-wide program is administered by the Office of Human Resources, not by individual departments. A gift given under the University-wide program meets the specific IRC Section 74 requirements and the following parameters are required for this type of gift to be allowable and non-taxable to the employee.

• Form of gift
  • In order to avoid being reported as taxable income, the length of service gift must be in the form of tangible personal property.
  • If the length of service gift is in the form of cash, check, or negotiable gift certificate, the value of such item is treated as additional wages regardless of the cost or value (see Nominal Gifts (Merchandise) section above for the exception) and is fully reportable and taxable to the employee.
• Timing
  • The gift may not be made within the employee's first five years of service or more frequently than every five years. A length-of-service gift given within the first five years of service or more frequently than every five years will be fully taxable.
• Dollar limit
  • The value or cost of this type of gift cannot exceed $400, the IRS threshold for taxability. It should also be commensurate with the number of years of service being recognized (e.g., the 15-year service gift is greater than the 10-year service gift, etc.).
    • A length-of-service gift with a value or cost over $400 will be taxable to the extent the value or cost exceeds the dollar limit (e.g., if a $450 gift is given, $50 is taxable to the employee).
  • If an employee retires the same year as s/he becomes eligible for a length-of-service gift, the maximum value or cost of all gifts in total must not exceed $400 for the gift(s) to be nontaxable.
• Meaningful presentation
  • The length of service gift must be presented as part of a special event or celebration that marks the occasion, such as a departmental meeting, party or luncheon.

Retirement Gifts

A gift to an employee on the employee's retirement from the University is allowable, provided it meets the IRC guidelines stated above; i.e., a gift tangible personal property, total cost not exceeding $400.

Other

• A gift cannot be purchased with sponsored funds (i.e., University Chartstrings in Fund 13). A gift may be purchased with restricted gift funds (i.e., University Chartstrings in Funds 15 or 16) if the restrictions allow for such expenditures.
• Gifts shall be charged to: Account 569919 - Gifts Non-Taxable and/or Account 569920 - Gifts, Taxable.
• A gift may be purchased utilizing the University's pro-card and/or an employee may be reimbursed for the purchase of a permitted gift by submitting an Employee Expense Voucher. The specific information required for each recipient and transaction follows.
  • Documentation for each gift transaction must include each of the following:
    • Recipient's name
    • SUID (if applicable)
    • Relationship if not an SU employee (e.g., donor, trustee)
    • Amount
    • Reason
    • If a gift certificate, a copy of the vendor's certificate limitations/restrictions proving it is non-negotiable (i.e., that it is in accordance with the requirements listed in the Nominal Gifts section).
  • If the required documentation is not provided for a purchase using the University's pro-card, the cardholder will be required to reimburse the University for the gift amount expended within 10 business days of notification by the Comptroller's Office or the transaction will be taxed to the cardholder as a personal business purchase. If the required documentation is not provided for a purchase to be reimbursed via an Employee Expense Voucher, such expenditure will not be reimbursed to the employee.
• A concern / sympathy gift in the form of a contribution to a charitable organization must be processed via University requisition. Proof of the organization's tax exempt status must be provided when requested by the Comptroller's Office. If proof is not provided, the requisition will not be processed.
• To the extent any gift does not meet and/or exceeds the criteria and limitations detailed in this policy, it will be taxable to the recipient.
• If a gift to an unrelated individual or non-charitable entity is purchased (unallowable transactions) utilizing the University's pro-card, the cardholder will be required to reimburse the University for the total amount expended for such purpose within 10 business days of notification by the Comptroller's Office or the transaction will be taxed to the cardholder as a personal business purchase. If a gift is purchased by an employee and submitted for reimbursement on an Employee Expense Voucher, the amount will not be reimbursed.
• Under no circumstances will an individual be reimbursed for a gift made by cash or personal check to employees, trustees, donors, volunteers, or others. All cash gifts, regardless of amount, must be processed through payroll or issued via University check and be reported as taxable income to the recipient.

Policy Administration

• Comptroller’s Office

Amended: November 2008 (pending review)
September 2006

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