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UPB - Presenting Gift Cards to Foreign Nationals

Presenting Gift Cards to Foreign Nationals

Gift Cards

Gift Cards or certificates are commonly used for door prizes and certain awards. They are taxable the same as a check or direct deposit payment, regardless of the amount on the card.

Whenever possible, do not present a gift card to a foreign national nonresident alien. It is best to issue a check by submitting an award or prize payment using the Foreign National Payment e-Form (FNPe-Form).

If you must present a gift card:

Ask the recipient to provide identification for tax purposes. All gift cards must be reported.

If the person is a nonresident alien and you can’t issue a check, you must submit the awarded amount of the card to University Payroll & Benefits on a FNPe-Form for tax reporting purposes.

  • Verify the visa holder is eligible for the payment.
  • Collect the required documents, especially the W-8BEN.
  • Submit the FNPe-Form. Indicate that a gift card was presented and identify the amount of the gift card.
  • The value of the card will be grossed-up and taxes charged to the unit.

Never do these things:

Gift cards or certificates are taxable income. It is important to track them for tax purposes. Avoid practices that make tracking and reporting income to non-resident aliens difficult or impossible.

Never issue an electronic gift card or certificate using an e-code that is emailed to the recipient. This is not allowed.

Never present a card to anyone without reporting the taxable income.

Additional Information:

https://www.obfs.uillinois.edu/payments-foreign-nationals/other-types-payments/award-prize-human-subject-payments/ https://www.obfs.uillinois.edu/bfpp/section-8-payments-reimbursements/determine-allowability-gifts-awards

If you need help, contact the Foreign National Service Center at fninquiry@uillinois.edu.




Keywords:Presenting Gift Cards to Foreign Nationals   Doc ID:119887
Owner:Erik O.Group:University of Illinois Training and Development Resources
Created:2022-07-25 10:10 CDTUpdated:2022-07-25 10:15 CDT
Sites:University of Illinois Training and Development Resources
CleanURL:https://answers.uillinois.edu/training/upb-presenting-gift-cards-to-foreign-nationals
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