This year Ed celebrated his 25th year as an employee of Designer Jeans Company. In recognition of his long and loyal service, the company awarded Ed a gold watch worth $363 and a $2,190 cash bonus.
What amount must Ed include in his gross income?

In reporting gross income cash bonuses are included included in income. This is because such bonuses are regarded as income, companies sign contracts with customers promising to pay a certain amount as bonus for meeting a certain performance target.

Awards are not considered part of gross income up to $400. Awards can be for length of service, an achievement and son on.

So the amount included in gross income is $2,190. The gold watch worth $363 is not included as it does not reach the limit of $400.

This year Ed celebrated his 25th year as an employee of Designer Jeans Company. In recognition of his long and loyal service, the company awarded Ed a gold watch worth $363 and a $2,190 cash bonus. What amount must Ed include in his gross income?

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This year Ed celebrated his 25th year as an employee of Designer Jeans Company. In recognition of his long and loyal service, the company awarded Ed a gold watch worth $363 and a $2,190 cash bonus.
What amount must Ed include in his gross income?