Business By The Books with Danielle Hayden Tax-Savvy Gift-Giving: A Guide for Business Owners This Holiday Season – Ep. 199
The holidays are here, and it's the perfect time to show appreciation for the people who make your business thrive—your employees, contractors, and clients. But we know that gift-giving as a business owner can feel tricky. So, how do we balance generosity while staying compliant with the IRS?
In this episode, host Danielle Hayden, CPA and founder of Kickstart Accounting, Inc., is here to guide you through the gift-giving process in a way that's simple, stress-free, and keeps you tax-compliant. From what counts as a deductible gift to thoughtful ways to give your team a boost of morale and company culture, Danielle breaks it all down in an easy-to-follow framework. Whether you're planning something small or looking to go big, this episode will help you gift confidently and compliantly, all while making your team and clients feel truly valued.
Key Takeaways:
-
Follow IRS Gift Rules: Gifts to employees must be tangible and under $75 to remain tax-free, while cash or gift cards are always taxable.
-
Use a Gift-Giving Framework: Clarify your motivation, identify the recipient, consider the perceived value, and ensure the gift aligns with IRS limits.
-
Make Payroll Gifts Meaningful: Create special moments around payroll-based gifts with personalized communication or gross-up amounts to cover taxes.
-
Document for Deductions: Keep detailed records of all business gifts, including cost, recipient, and purpose, to ensure tax compliance.
-
Consider Personal Gifting Options: Use owner's draws for personal generosity while ensuring compliance with salary requirements for S Corp owners.
Topics Discussed:
What Qualifies as a Business Gift (00:00:50 - 00:01:25)
Framework for Business Gift-Giving (00:02:17 - 00:04:36)
IRS Rules for Gifts to Employees (00:05:03 - 00:08:38)
IRS Rules for Gifts to Contractors & Clients (00:08:39 - 00:10:18)
Gift Recordkeeping (00:12:09 - 00:13:01)
Giving Gifts with Owner's Draws (00:13:28 - 00:15:21)
Resources:
Free Guides | https://kickstartaccountinginc.com/Gift/
How to Pay Yourself as a Business Owner
6 Tax Tips Every Business Owner Should Know
Book a Call with Kickstart Accounting, Inc.:
https://www.kickstartaccountinginc.com/book
Connect with Kickstart Accounting, Inc.:
Instagram | https://www.instagram.com/Kickstartaccounting
YouTube | https://www.youtube.com/@businessbythebooks
Facebook | https://www.facebook.com/kickstartaccountinginc