Prizes and Awards

Science Fair Prize Awarded to U.S. High School Student Dependent of a Resident Alien

Question:

We have awarded a science fair prize of $250 to a high school student who is attending high school in the US while her father teaches/works/researches at a local university.  The father files as a resident alien in the US. 

Do we need to report or withhold on the payment to the daughter?  Do we need to get documentation for the daughter and/or the father?  What other information do I need to obtain to consider whether there is a filing or withholding requirement for this prize?

Answer:

We will answer your questio . . .

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University Department Wants to Hold Competition: How do We Report Winnings?

Question:

We have a department at our university who wants to hold a competition, in which there will be an entry fee, and have a committee select the winners who will receive cash prizes/awards and one winner will receive a sewing machine.  Is this reportable on Box 3 of the 1099-MISC or should it be awarded on the 1098-T?  Does the entry fee make any difference in this scenario?

Answer:

Prizes for non-employees ba . . .

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Gift Certificates

Question:

My questions relates to tax liability on gift certificates. I work as manager of Accounts Payable for a University. Our student organization has given out several gift certificates for Bowling and/or Billiard Party at the University Student Union Games Center. The value of the gift certificates is $200. The Games Center is donating the bowling lane fees and bowling balls and shoe fees for up to 18 people. There is no cost to the University for this part of the gift. In addition, the gift certificate covers the cost of Pizza that is served by our University Food Service. The cost of Pizza is $75. Question: Should we track this for 1099 reporting? Is there a tax liability to the recipient of the gift certificate? Is the tax liability just on the amount of the Pizza (cost to the University), or is it the total value of the gift certificate? Thank you for your help.

Answer:

Quite a few things come int . . .

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I understand that prizes to employees are reportable on IRS Form W-2 . . . .

Question:

I understand that prizes to employees are reportable on IRS Form W-2 as wages. I just want to clarify the following issue. If an employer sponsors an event and gives attendance prizes, will an attendance prize won an employee be reportable on the W-2 rather than the 1099 even if the event and employee's attendance of the event have nothing to do with the employee's job duties. Thanks you for your assistance.

Answer:

 
Whether a priz . . .

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We have a program running all year that if you . . .

Question:

We have a program running all year that if you sell our vacuumes you will be giving money for selling that machine. We have an outside service that collects the amount of vacuumes sold and then funds a credit card for that amount. Then in turn they tell us how much they have funded on these cards and we wire the funds to them. We have a gentleman who insists that we are reporting in the incorrect box.

Answer:

Prizes based on services pr . . .

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