Nature of Selection
- Awards: Awards are gift cards given for meritorious performance, productivity or other reasons. Awards can also be given to non-employees in recognition of an accomplishment, achievement or activity that does not require the performance of a service.While employment and education related awards can be provided to UA employees and students, these awards should be processed through HR and Student Receivables, respectively, and cannot be given via a UA gift card. UA gift cards are allowable for awards unrelated to employment or education to non-UA Individuals.
- Gifts: Gifts are non-cash items given to express appreciation or gratitude. Gifts are not related to job performance and no negotiation is conducted in advance. Examples include items given to a donor for appreciation/recognition of donation to UA or to a speaker for appreciation/gratitude. UA gift cards cannot be utilized for gifts.
- Incentives: Incentives are items given in order to motivate or encourage response or participation to a survey, questionnaire, or event. Incentives are typically used by grants or research projects and must have a documented anticipated benefit. UA gift cards are allowable for incentives.
- Prizes: Prizes are items of value received as a result of a contest of skill or participation in an event. Examples of contests of skill include a golf tournament or a basketball shooting contest. Prizes may only be awarded where benefits are expected to accrue to the University, such as an increase in event attendance or to raise funds/donations. UA gift cards are allowable for prizes.
- Drawings: Prizes and incentives may be given as a result of a drawing. Drawings are only allowable in situations where everyone involved in an event, organization, etc., has an equal chance to receive an item and where involvement is not exchanged for something of value. Completing a survey, providing information, or participation in an activity are allowable forms of involvement in the drawing. For example, if all participants in an event are entered into a drawing, and the participants did not have to provide something of value to be entered, then this type of drawing would be allowable. UA gift cards may be provided as an incentive or prize through a drawing.Note that raffles and games of chance in which a person risks something of value are currently illegal in the state of Alabama due to gambling laws.
Affiliations of Recipients
- UA Employees: Gift cards are generally unallowable as gifts to UA employees. This would be considered taxable compensation and is reportable on Form W-2.
- UA Student Employees: Student employees receiving a gift card related to their position with the University should be reviewed as employees. As such, gift cards are generally unallowable as gifts to UA student employees as this would be considered taxable compensation and reportable on Form W-2.
- UA Students: Gift cards given to UA students are potentially reportable as Other Income on Form 1099.
- Non-UA Employees: Gift cards may be given to non-employees but are potentially reportable as Other Income on Form 1099.