A church has used the voluntary services of a bookkeeper and would like to gift to her a $500 gift card. Since she is not an employee of the church, is this gift taxable?
The gift card will be treated as taxable compensation for services rendered. If she is an employee, this income will be reported on a Form W-2. If she is not an employee her income will be reported on a Form 1099-MISC (unless her annual earnings fall below $600) and will be reportable by her on Schedule C and also subject to Self-Employment tax on Schedule SE.