Chapter 4: Business & Administration

04:76:00   Gift Card Policy

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Related Policies and Guidelines

TBR Policy 04.02.10.20 Gift Cards

Purpose

The purpose of this policy is to establish the college’s policy and guidelines for the purchase and use of gift cards. This policy applies to all uses of gift cards by all college personnel (all faculty and staff) for college business, regardless of funding source (including Foundation or grant funds).

Definitions

• IRS: Internal Revenue Service
• Gift Cards: A store-valued or similar instrument in lieu of cash or check, including without limitation, a gift certificate. Examples of gift cards:
  • Anywhere/anytime cash such as Visa, American Express or moneyorders
  • 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 Institution Bookstore
  • Virtual gift cards such as Amazon
  • Paper gift certificates are considered the same as gift cards.
• Gift Card Log: Log to record gift information required by the Business Office to be able to issue applicable Form 1099 to the recipient unless a separate account code is utilized, if required.
• Custodian: Individual charged with physically maintaining and securing the gift card instruments.
• PI: Principal Investigator, if applicable for a grant
• IRS B Notice: Notice provided to employers indicating incomplete or incorrect data on IRS forms.
• Form W9: The form identifying the taxpayer identification number (TIN) and certifications required by the IRS.

Policy

Any non-student Institutional employees or a student who is employed by the institution in a regular part-time or full-time benefitted position are not eligible to receive gift cards. Temporary student employees are eligible to receive gift cards.

Gift cards may be allowed in situations where it is determined that expenditures are in the best interest of the Institution and promote the purposes of the Institution. The determination of whether a gift card is allowable is dependent upon the selection of the recipient, the reason for the gift, the source of funding, and the recipient’s affiliation to the Institution.

Gift cards, regardless of the value, are considered cash equivalents by the Internal Revenue Service and are subject to tax reporting. Departments purchasing and distributing gift cards are responsible for compliance with IRS regulations and Institution policies.

The maximum face value of any gift card purchased under this policy is $100. Splitting the purchase or distribution of gift cards into multiple gift cards to circumvent the $100 limit is prohibited.

Gift cards may be purchased under the following circumstances:

• A gift card may be purchased if it is not for a specific person, but for an approved event prize.
• Gift cards may be purchased as appreciation for a volunteer. This does not apply to volunteers who are also college employees (other than temporary student employees) or current college contractor.
• The use of gift cards for sponsored project participants is permitted as incentives or awards of externally-funded sponsored project participants as described in the grant proposal. If the gift card was not described in the grant proposal, the purchase of a gift card on a sponsored project requires prior written approval from the sponsor. If prior approval is not obtained, the gift card purchase is not allowable on the grant.
• Other gift card purchases will be considered during the approval process.

Gift cards purchases are prohibited in the following circumstances.

• Gift cards may NOT be purchased for non-student employees, or current suppliers and vendors.
• Gift cards may NOT be purchased as gifts for graduating students.
• Gift cards may NOT be purchased as holiday or other gifts to employees or students.
• Gift cards may NOT be purchased to pay suppliers or other vendors for goods and/or services received.

Procedures

The purpose and purchase of gift cards must be pre-approved by the Vice President for Finance and Administration and the President.

The budget manager for the unit/department requesting the purchase of gift cards is responsible for the following:

• Verifying all department gift card responsibilities required by this policy are performed effectively.
• Ensuring all gift cards and personally identifiable information (PII) in their possession are effectively secured.
• Ensuring sufficient documentation is received to support the disposition of each gift card.
• Reviewing and reconciling all gift card purchases and disbursements.
• Obtaining and assuring the accurate completion of the required IRS Form W9 for each gift card disbursed and submitting the completed form to the business office.

Obtaining Approval for Purchase

Gift cards must be purchased by using the standard college purchase requisition in Banner (even if purchased from the campus bookstore). All required approvals must be submitted through the normal requisition process before any gift cards are purchased.

NOTE: Instances where gift card purchases occur before approval is obtained will not be considered for reimbursement.

Maintaining and Distributing Gift Cards

When gift cards are purchased, the Custodian (budget manager of purchaser department) must maintain required documentation related to the distribution of the card. The following information must be tracked for each disbursement using the college’s “Gift Card Log.”

• Gift Card Number
• Gift Card Amount
• Name of Recipient
• Affiliation with the college
• Taxpayer Identification Number (Normally the social security number)
• Date Distributed

The recipient must sign the “Gift Card Signature Sheet” to acknowledge receipt of any gift cards, and provide a completed IRS form W-9 when custody of the gift card is transferred.

Until disbursed, the custodian must secure the cards in a locked area. The Institution is required to report certain payments to the internal revenue service. Therefore, gift card documentation (Gift Card Log, Gift Card Signature Sheet, and IRS Form W-9) must be submitted to the Office of the Vice President for Finance and Information Technology within 10 days of the final distribution or December 31 (whichever is earlier).

Social Security Numbers (SSN) are considered personally identifiable information (PII). The collection and use of social security numbers to facilitate the management of gift cards is approved as part of the Gift Card policy. However, all PII must be maintained securely to avoid inappropriate disclosure.

Exceptions by the Chancellor

Any exceptions to the policy require approval by the Tennessee Board of Regents Chancellor.

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Divisional Review Responsibilities Checklist: Finance and Administration