Giveaway Items – why business professionals should keep them at $4 or less per item.

Giveaway items that you use to publicize your business (such as pens, coffee cups, T-shirts, refrigerator magnets, calendars, tote bags, and key chains) are deductible. However, you are not allowed to deduct more than $25 in business gifts to any one person each year.

The following items aren’t considered gifts for purposes of the $25 limit.

An item that costs $4 or less and: 

a. Has your name clearly and permanently imprinted on the gift, and

b. Is one of a number of identical items you widely distribute.
Examples include pens, desk sets, and plastic bags and cases.

Signs, display racks, or other promotional material to be used on the business premises of the recipient.

EXAMPLE: A Real Estate Agent orders 1,000 ballpoint pens with his/her name and company logo printed on them and distributes them. Each pen costs $1. The pens do not count toward the $25 gift limit. The Agent may deduct the entire $1,000 expense for the pens.

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