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Employee Holiday Gifts: Are They Taxable? A Quick Guide

With the holiday season approaching, many businesses are considering how to show appreciation to their employees. While thoughtful gestures like gift cards, holiday parties, or personalized presents can boost morale, it’s essential to understand their tax implications. Depending on what you give, the IRS may classify your gift as taxable income to your employees.

Gift cards are always considered taxable income, regardless of the amount, because the IRS views them as equivalent to cash. Gift items like a company-branded mug or a holiday fruit basket may qualify as non-taxable as they are given occasionally and are relatively low in value.

Bonuses—while appreciated—are always considered taxable income, so it’s essential to plan for withholding when issuing them.

A popular option to reward your team and boost morale is to host a holiday party. Expenses for this type of event are generally non-taxable to employees since the event is infrequent and primarily for the benefit of the team.

Our tax and accounting professionals are here to help businesses navigate these IRS guidelines as they seek to show gratitude to their hard-working employees at the holidays and throughout the year.

Hayden Phillips

Staff Accountant

Hayden Phillips joined Canon Capital in September 2024 as a Staff Accountant. Prior to joining Canon Capital, Hayden built a solid foundation in auditing, reviewing financial data for accuracy and compliance, and conducting internal control testing. Known for his strong work ethic, adaptability, and exceptional interpersonal skills, his background includes hands-on work with reconciliations, analytical reviews, and financial reporting for a variety of clients. Hayden earned both a bachelor’s degree and an MBA in Accounting and Business Administration from Cairn University. He resides in Telford with his wife, Alyssa, and their daughter, Skylar. Outside of work, he enjoys playing and coaching soccer, spending time with friends and family, traveling, and hiking.

Georgia Myers

Shareholder & Director

Georgia joined Canon Capital in 1993. Her experience as an auditor at three CPA firms over 30 years afforded her exposure to many different not-for-profit, government, and for-profit entities, such as private schools, senior centers, mission and church organizations, civic organizations, social services agencies, retirement communities, pension plans, local government units, local government pension plans, real estate developers, real estate agencies, and manufacturing companies. Georgia received her BS in Accounting from Messiah College, holds a Chartered Global Management Accountant (CGMA) designation and is a member of the PICPA and the AICPA. She serves in a volunteer capacity with Bridge of Hope National, Souderton Brethren in Christ Church and the Big Red Band Boosters. Georgia resides in Souderton with her husband and two sons. She enjoys reading, playing the flute, and traveling.

Celebrating Excellence: Recent Achievements by the Canon Capital Management Group Accounting Team

Two of our Canon Capital Management Group team members have recently achieved significant milestones in their professional development.

We are proud of Chris and Amanda for their hard work and commitment to excellence. Please join us in congratulating them.

Chris McDonnell Achieves AI Certification for Accountants

Chris McDonnell, CPA, CAIA has earned a certification in AI for Accountants, equipping him with cutting-edge skills to leverage artificial intelligence in financial processes.

With this advanced knowledge, Chris will lead our team in offering even more innovative and efficient accounting solutions, ensuring our clients stay ahead of the curve.

Amanda Spengler Earns NACPB Certification

Amanda Spengler has achieved her Bookkeeping Certification from the National Association of Certified Public Bookkeepers.

This accomplishment highlights Amanda’s dedication to maintaining the highest standards of accuracy and integrity in managing our clients’ financial records.

These achievements reflect our ongoing dedication to the clients we are privileged to serve.

Moriah Randolph

Staff Accountant

Moriah started working with our accounting team on a seasonal basis in February 2021, joining us full-time in May 2021. Moriah holds an Associate of Applied Science degree in Accounting, which she earned from Montgomery County Community College. Most recently, she has become a Certified ProAdvisor for QuickBooks Online (QBO).  Moriah lives in Telford where she spends her free time baking, crafting, and playing volleyball.

Navigating the New Overtime Rule: What Employers Need to Know

As the calendar inches closer to July 1st, 2024, employers across the nation are preparing for a significant shift in overtime regulations. The Department of Labor’s recent announcement regarding the new overtime rule has left many businesses seeking clarity on how this will impact them.

Eligibility Expansion

One of the primary objectives of the new overtime rule is to extend overtime protections to a broader segment of the workforce. Previously, employees earning below a certain salary threshold were automatically eligible for overtime pay. However, with the updated regulation, this threshold is set to increase, including more employees within its scope.

Image Credit: US Department of Labor

Impact on Lower-Wage Workers

Workers earning salaries below the revised threshold will see the most direct impact. As they become newly eligible for overtime pay, they stand to benefit from increased compensation for any hours worked beyond the standard 40-hour workweek.

Adjustments for Employers

Employers, on the other hand, will need to adapt their payroll and workforce management strategies to accommodate the expanded eligibility criteria. This may involve reassessing employee classifications, adjusting compensation structures, or implementing changes to work schedules to ensure compliance with the new regulations.

Industries and Sectors Affected

While the new overtime rule applies across various industries and sectors, specific industries may feel its effects more heavily than others. Sectors with more lower-wage workers, such as retail, hospitality, and healthcare, will likely see more employees impacted by the rule change.

Our Payroll Professionals Are Here to Help

Our Payroll team is here to help you navigate the payroll-focused intricacies of this new overtime rule with confidence. Call 215-723-4881 or contact us online.

Maximize Your Tax Refund: Why Your Employees Need a Paycheck Check-Up Now

Were your employees’ tax return results not what they expected this year? Many taxpayers have had the unpleasant surprise of a tax bill instead of the anticipated refund. This is likely due to not having enough funds withheld from each paycheck.

That’s why we recommend a paycheck check-up at least once a year, whether completed at the start of the calendar year or right now, to ensure they’re withholding the right amount for the remainder of this year. Share this paycheck calculator on the IRS website to help them run their numbers and make any necessary adjustments to their W4 form.

Questions? We are happy to help. Give us a call at 215-723-4881.

Brent Snyder

Operations Manager

Brent Snyder joined Canon Capital in October 2024, bringing over 25 years of expertise in the technologies field. Brent holds a B.A. from Temple University and is a graduate of their Fox School of Business. An active community member, he serves on the Board of Directors for Harleysville Baseball and #IronDad23, a non-profit helping local families and students in the Souderton Area School District. He lives in Souderton with his wife, Laurie, their sons, Chase and Austin, and their cat, Snickers. Outside of work, Brent enjoys cheering on all Philadelphia sports teams, watching his sons play sports, and plans to visit every Major League Baseball park with his family, having checked off seven so far.

We take the hassle out of payroll

We provide unparalleled support and personal service. Our reputation for providing accurate, on-time payroll makes us different from the competition We customize our services to match your company’s individual needs to serve any size group or program.

We offer competitive prices and responsive service.   Our competitive fees keep your payroll costs down while our in-house expertise adds value to the payroll process. With the support of our Certified Public Accounting and Technologies departments, Canon Capital can answer your questions quickly and be responsive to your special needs.

We eliminate the pain of in-house payroll processing. By providing services not always available with other payroll groups, such as withholding and reporting local and LST taxes, Canon Capital takes the effort out of payroll. From the simple conversion and start-up through comprehensive, easy-to-read reporting, our payroll services save you time, money and stress.

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