State Controller Policy
Effective Date: 05/30/2019
Approved by: Robert Jaros, CPA, MBA, JD, Colorado State Controller
Policy
Under the Fiscal Rules, this is a State Controller Fiscal Policy. All Agencies and Institutions of Higher Education (IHEs) that follow the Fiscal Rules shall comply with this Policy when providing Employee Appreciation Items.
Definitions
- Employee Appreciation Items - Examples include awards, clothing, meals, cards, flowers, and other items intended to show employee appreciation.
- De minimis - Any property or service provided by an employer for an employee, the value of which is so small in relation to the frequency with which it is provided, that accounting for if is unreasonable or administratively impracticable.
Policy
Agencies or institutions of higher education may provide Employee Appreciation Items to their employees in accordance with this Policy.
Frequency of Employee Appreciation Items
Employee Appreciation Items may be provided only on an occasional basis. An item is not provided on an occasional basis if:
- It is provided to all attendees as a routine or common part of regularly scheduled events or meetings;
- It is provided more often than once per calendar quarter; or
- It occurs with such regularity that employees reasonably expect to receive the Employee Appreciation Items at a fixed time or during a certain event.
Value of Employee Appreciation Items
Employee Appreciation Items may be provided only if their value is not more than $100 in total per calendar year (IRS limit). The limit does not include bonuses or other incentives or compensation paid in the course of employment through the payroll system. The limit does include gift cards that are paid through the payroll system.
Tax Reporting
- Permissible Employee Appreciation Items may still be reportable as income under the Internal Revenue Code and its implementing regulations, which includes any cash or cash equivalent (gift cards). The Agency or Institution of Higher Education is responsible for properly reporting all Employee Appreciation Items in accordance with the Internal Revenue Code and its implementing regulations.
- De minimis Employee Appreciation Items provided to employees in accordance with this Policy where these items are not cash or cash equivalent, are not taxable to the employee.