Case Study

The president of Waukegan Materials, Inc. wants to implement an Employee-of-the-Quarter recognition program. (p. 279) The president has requested the planetary manager to provide a recommendation for an appropriate endowment fund and draft a congratulatory letter for the recipient. The president has organized an awards committee which selects each recipient. The president wants a financially answerable gift. The gift and letter are scheduled for presentation during the succeeding(prenominal) quarterly supervisors luncheon next month.
Waukegan is a construction retailer. Waukegan is a blue collar organization.
One critical business issue is the cost of the gift. This business issue is intensify with tax implications to Waukegan Materials, Inc. and award recipients. IRS Publication 525 outlines allowable dollar maximums for employer gifts which capture a neutral tax impact. (http://www.irs.gov/pub/irs-df/p525.pdf)
Employee achievement award. If you make tangible personal property
(other than cash, a gift certificate, or an equivalent item) as an award for
length of service or safety achievement, you generally can exclude its value
from your income.



However, the arrive you can exclude is limited to your
employers cost and $1,600 ($ cd for awards that are non certifiable plan awards)
for all such awards you receive during the year. Your employer can tell you whether
your award is a qualified plan award. Your employer must make the award as routine of
a meaningful presentation, under conditions and circumstances that do not create a significant likelihood of it being mask pay.
Another critical business issue is to select measuring rod criteria for the recognition of an employee each quarter. Tom McMullen notes Fortunes some Admired Companies excel at aligning their programs with business goals… (Journal of wages and Benefits, 2010, March). Their committee would develop a vision for Waukegan and accompany that with direct values. This will assist the selection...If you want to get a wide of the mark essay, order it on our website: Orderessay



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