Expenditures: Gifts to Employees, Non-Employees, and Students

Scope

All Indiana University units, employees, non-employees, and students. 

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Policy Statement

Gifts to employees, non-employees and students are not permissible with IU or IU Foundation (IUF) funds with the exception of the following purposes:

A.   Retirement gifts to employees, not to exceed $400

B.  Gifts to non-employees that contribute to Indiana University's  mission (e.g. donors, guest speakers or visitors contributing to the university mission), not to exceed $500

C. De minimis gifts to employees, non-employees and students of tangible goods, distributed for business or promotional purposes (e.g. t-shirts, mugs, stationery, etc.).

E. Occasional, individual tickets to non-IU events or an IU event where there is no additional cost to the university. Tickets must be within the de minimis standard threshold.

F. Flowers or similar purchases for employee bereavement of family members as defined in (HR-05-110). These purchases are subject to the university de minimis standard.

G. This policy does not govern the following activities:

• Years of service awards, as permissible by IU Human Resource (IUHR) or University Academic Affairs. Please see (HR-02-120) for more details on service credit and awards.

• Gifts received by employees from outside parties. Gifts received by external parties are addressed in the Conflicts of Interest and Commitment Policy (UA-17)

• Incentives, prizes or awards received as part of a contest or drawing. See IU Policy Expenditures: Incentives, Contests, Drawings, Games, and Prizes Policy (FIN-ACC-640)

• Payments to research participants. See IU policy Research with Human Subjects: (RP-11-004)

Special Considerations

A. Gift Cards or Cash Equivalents: Any gift to an employee, non-employee or student must be in the form of tangible personal property and cannot include items such as gift cards, travel certificates, Crimson Card contributions, meal points, cash, or cash equivalents.

• A gift card or cash equivalent of any dollar amount that is issued in exception to this policy is taxable to the individual recipient and must be reported to the Office of the University Controller (UCO).

• If the recipient is a student, any gift card or cash equivalent, regardless of dollar values is required to be reported to University Financial Aid (see procedures section below).

B. Incentives and Prizes for Students: All contests involving students must follow Payments to Student Guidelines

C. Gifts as Compensation: Gifts cannot be made to employees in lieu of compensation. All employment related compensation must be paid through university payroll.

D. Use of Restricted Funds: Payments under this policy cannot be made with restricted funds, including contract and grant accounts, loan funds, scholarship accounts or restricted gift accounts, unless explicitly approved in writing by the granting agency via the agreement or guidelines or donor intent. 

E. Use of Auxiliary Service Center Funds: Gifts cannot be made with funds from service center accounts (sub-fund AUXSER).

F. Taxes related to gifts: All gifts to employees and non-employees outside of the explicit exceptions noted above are taxable and reportable to the IRS and must be reported to UCO (see procedures section below).

G. Exceptions to Policy: Exceptions to this policy may be made by a department’s respective Vice President, Provost, Chancellor, or designee. Approval for such exceptions must be obtained in writing in advance and reported to UCO for tax reporting purposes (see procedures section below).

Expenses Subject to Mandatory Reporting Under HLOGA

A. The terms of this policy shall not apply to expenses that are: (1) subject to mandatory reporting under the Honest Leadership and Open Government Act of 2007 (“HLOGA”) or (2) official business of the Director of Federal Relations. HLOGA covered expenses must be approved ahead of time by the IU Office of Federal Relations. Failure to do so may result in nonpayment of such expenses.

B. All reportable expenses under HLOGA must be paid directly to a vendor or to a university employee for reimbursement. The following items are NOT allowable expenses:

• Reimbursements paid directly to any covered federal official

• Stipends paid to any covered federal official; and

• Honorariums paid to any covered federal official

C. HLOGA covered expenses must be approved ahead of time by the IU Office of Federal Relations. The IU Federal Government Official Reporting form should be used to report all expenses pertaining to the visit of a federal government official. These officials may include certain individuals associated with the executive and legislative branches of federal government, as well as military officials. Please contact the IU Office of Federal Relations to determine whether expenses for a particular individual will be reportable under HLOGA. Failure to seek approval from the Office of Federal Relations may result in the inability to offer items of value (meal, lodging, souvenir, etc.) to a visiting covered federal official.

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Reason for Policy

As a public institution, Indiana University is entrusted with funds by various constituencies. In order to carry out its fiduciary duty, university employees must demonstrate prudent judgement when expending funds.

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Procedures

Procedures for tax reporting will be maintained by IUF and UCO and are posted on the Office of the University Controller website at IU Accounting Standards. For questions please contact UCO using the UCO Contact Form. 

Fo questions regarding Financial Aid reporting obligations, units should consult the university’s Payments to Student Guidelines.

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Definitions

De minimis: A benefit for which, considering its value and the frequency with which it is provided, is so small as to make accounting for it unreasonable or impractical. The university’s current de minimis threshold applies to tangible goods under $100, which are distributed to any given individual on an infrequent basis.  This threshold is applicable in aggregate for all sources of funds (e.g. IU and IUF funds would be combined towards this limit) paid in a single calendar year.

Gift: Any tangible or cash equivalent item that is being provided to an individual where there is no expectation of a return benefit, including services.

HLOGA: Congress passed the Honest Leadership and Open Government Act (HLOGA) in September 2007. The goal of this law is to shed more light on the role of lobbyists in influencing federal legislation. For additional information see https://gov.iu.edu/policies/lobbying/index.html.

No Additional Cost: A complimentary ticket will fall within the no additional cost exclusion when a) the university does not incur any additional costs to provide the ticket, b) no revenue was lost in the course of providing the ticket and c) the ticket would not have otherwise been sold to the public (i.e., the event would not be otherwise sold out). Individual tickets given are required to be under the de minimis threshold.  Additionally, only single event/game tickets may be given. Season tickets are not permissible under the no additional cost exclusion.

Retirement: For purposes of this policy retirement only applies if the individual meets the IUHR standards for retirement status.

Tangible Personal Property: It refers to any type of physical property that can generally be moved (i.e., not attached to real property or land). These generally include items such as furniture, clothing, jewelry, art, writings, or household goods. This does not include cash or cash equivalents including gift cards.

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Additional Contacts

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History

Indiana University has a long history of not allowing gifts. Policy I-50, Allowable Hospitality Expenses, indicates that "Gifts of any kind, to any individual, whether or not they are University personnel" are not allowable. This policy on gifts is confirmation of the institution's position and in addition provides guidance on the types and cost of gifts that can be purchased using IUF funds.

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