The purpose of this policy is to set forth guidelines and procedures related to gift cards and/or gift certificates purchased through the UGA Foundation.
The Foundation follows Internal Revenue Service (IRS) regulations and UGA policy as they pertain to gift cards and gift certificates. Under Internal Revenue Code Section 132, a gift card, gift certificate, store-value card or a prepaid credit card, collectively referred to as a gift card, is considered a cash or cash equivalent that is subject to taxes regardless of the face value. The value of gift cards given to students and non-employees is taxable and reportable income on IRS form 1099-MISC if the value of gift cards and any other payments received aggregates to an amount of $600 or more per calendar year.
In addition, gift cards can be susceptible to fraud or misappropriation because they lack the audit trail that exists with a check or other forms of payment. As a result, the Foundation places strict restrictions concerning the purchase and distribution of gift cards.
Examples of gift cards (As defined by the IRS):
- Anywhere/anytime cash such as Visa, American Express or money-orders
- Store gift certificates or cards that are redeemable for a large variety of commodities, such as Walmart or grocery store gift cards
- Gift cards or gift certificates to restaurants
- Gift cards to the University of Georgia Bookstore
- Virtual gift cards such as Amazon
Policy: Due to the enhanced risk associated with gift cards, they may only be purchased as outlined below. All other gift card purchases are prohibited for employees, students, volunteers or donors.
Unallowable Gift Card Purchases:
- Employees (including prospective employees)
- Gift cards may not be purchased with Foundation funds for an employee, including student employees.
- Students (including prospective students)
- Gift cards may not be purchased with Foundation funds for a student, including prospective students.
- Volunteers or Donors
- Gift cards may not be purchased with Foundation funds for the purpose of providing a gift to a non-employee.
Allowable Gift Card Purchases:
- Research Participants
- Gift cards may be purchased according to the University’s Policy 13.10 on Research Participant Incentive Payments. Please refer to that specific policy for guidance.
Date Effective: January 18, 2022
Last Updated on January 25, 2022