General Information & Forms
When the University distributes an award/prize from a drawing with a University business purpose unrelated to employee recognition, the award/prize is considered taxable to the recipient, regardless of the amount, and may require reporting to the Internal Revenue Service by the University. An Award/Prize Tax Data Collection Form must be completed by the awarding department and the awardee before providing the prize to the recipient. The recipient may be an employee, student, or other affiliate.
When distributing awards or prizes for employee recognition awards, use the Employee Recognition Award Compensation Form and follow policy and procedure in Policy 9.11 Employee Recognition instead.
A completed Award/Prize Tax Data Collection Form should never be emailed, as the form requires the provision of sensitive information. If submitting the form electronically, please upload through the secure Accounts Payable Document Upload. The form also provides the location for physical drop-off.
A recipient has the right to refuse an award if they are unwilling to provide the required information on the form. A prize recipient can also be provided a copy of the form on request.
Award/Prize Tax Reporting Obligation
Awards/prizes are considered taxable to the individual regardless of whether a copy of the form is provided to them. Recipients should consult with a professional tax advisor if there are questions about their obligations. University employees, while in their official role at the University, are not allowed to act as tax consultants or provide tax advice. Prize recipients can expect the University to report awards/prizes based on their tax residency status and their relationship to the University as follows:
- Non-employee U.S. citizens or permanent residents: Form 1099-MISC when the combined payments from the University for non-cash awards and the face value of cash/cash equivalents are greater than or equal to $600.
- Non-employee nonresident aliens: Value and grossed-up taxes will be included on Form 1042-S, regardless of amount.
- All employees: Value will be included on Form W-2, regardless of amount.