Employee Prizes and Awards
Prizes, awards, & raffle prizes received by employees are taxable and must be reported as additional earnings if their value exceeds the following dollar thresholds:
- Cash or gift certificates/gift cards of any amount (the IRS considers gift certificates to be equivalent to cash).
- Tangible personal property with a value greater than $100 (Tangible personal property less than $100 is considered "de minimus").
The source of funds for employee prizes and awards should be unrestricted funds.
Cash prizes are paid in an employee's paycheck. The value of tangible personal property is added to an employee's W2 taxable income.
Student Prizes and Awards
Prizes and awards received by students are taxable.
Cash prizes and awards are paid through Accounts Payable. Use the Supplier Invoice business process in Workday to initiate payment. Scan and attach a Student Fellowship, Prize and Award Payment Request form to the payment request.