Are Gift Cards Taxable?

We do not have an ordained minister but a member of the congregation that preaches the sermons every week and we feel he serves as our pastor. He does not take a salary and does not want to but the church has given him gift cards through out the year as way to say thank you for all he does. Are these gift cards taxable and should he report them as income?

Comments for Are Gift Cards Taxable?

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Mar 26, 2010
Taxability of Gift Cards or Cash Gifts to Pastor
by: Anonymous

If church members are claiming tax deductions for their contributions that are used to purchase gift cards, then the recipients of those gift cards (or gifts of cash) would be required to pay taxes on the money or the cash value of the gift cards received. If the payments received by the "pastor" are for services rendered by him (or her) and if the annual value of the cash gifts or the gift cards is $600 or more, then IRS Form 1099 must be filed with the IRS and sent to the recipient of the funds (or the gift cards)and such payments must be shown on the individual's annual tax return.

I am not a tax attorney nor am I a CPA, but these are my opinions....based on experience.

Jun 02, 2011
Gift Cards are Taxable
by: Vickey

Yes, they are taxable as they are for a service performed.

It would not be tax deductible for the donors as it is a contribution to an individual.

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