Gift Rules and Taxes for Small Businesses (2026): What the IRS, FINRA, CMS and Federal Ethics Rules Say

We sell a $35 logo mug gift box, printed, packed and shipped to each person's address, so we have a stake in these rules. This section quotes each rule from its source, dated, and does not tell you what you may give or deduct.

Key facts (each rule re-read at its source on October 29, 2026; the pages linked below give the full text):

• The IRS deduction: "You can deduct no more than $25 for business gifts you give directly or indirectly to each person during your tax year" (IRS Pub. 463).
• Employees: gift cards, "no matter how little, are never excludable as a de minimis benefit" (IRS Pub. 15-B).
• Federal employees: "$20 or less per source per occasion", and no more than $50 a year from one person (5 CFR 2635.204(a)).
• Broker-dealers: "$300 per individual per year" to another firm's people, since March 30, 2026 (FINRA Rule 3220).
• Mortgage and settlement services: "There is no exception to RESPA Section 8 solely based on the value of the gift or promotion" (CFPB).
• Physicians: the Stark nonmonetary compensation limit is $535 for calendar year 2026 (CMS).

Every Business Gift Rule in One Table

Some rules decide what a business can deduct. Others cap what a person may accept (government staff, company policies) or what a business may give (its own trade's rules). Read the row for each side of your gift.

Tax Rules: What a Business Can Deduct

The tax code caps the deduction at $25 for gifts to one person in a taxable year (26 U.S.C. 274(b)(1)), and IRS Publication 463 explains it:

"$25 limit. You can deduct no more than $25 for business gifts you give directly or indirectly to each person during your tax year."

"Incidental costs, such as engraving on jewelry, or packaging, insuring, and mailing, are generally not included in determining the cost of a gift for purposes of the $25 limit."

"A cost is incidental only if it doesn't add substantial value to the gift. For example, the cost of gift wrapping is an incidental cost. However, the purchase of an ornamental basket for packaging fruit isn't an incidental cost if the value of the basket is substantial compared to the value of the fruit."

IRS Publication 463 (2025), ch. 3 "Gifts", "For use in preparing 2025 Returns". Read October 29, 2026.

The limit is per person, not per gift, and you and your spouse count as one giver. Packaging, logo items, gifts to a company and the IRS's own $240 example: are client gifts tax deductible? A W-2 employee paying for client gifts personally faces a further question, because the code allows no "miscellaneous itemized deduction" for tax years after 2017 (26 U.S.C. 67(h)).

Employees are a different rulebook. Pub. 15-B says "Any fringe benefit you provide is taxable and must be included in the recipient's pay unless the law specifically excludes it", and lists "Holiday or birthday gifts, other than cash, with a low fair market value (FMV)" as de minimis, with no dollar figure (IRS Pub. 15-B). Details: employee gifts and taxes.

The $19,000 figure is gift tax, not business gifts. The IRS lists a $19,000 annual exclusion per recipient for 2026 (IRS gift-tax FAQ). It answers when a person's own gifts count for gift tax, not what a business can deduct: the $25 deduction vs the $19,000 exclusion.

This is information, not legal or tax advice. Check the current rule (or ask your tax professional) before you send.

The Recipient's Rules: Government Staff and Company Policies

Some recipients have caps of their own. Federal employees are the clearest case:

"An employee may accept unsolicited gifts having an aggregate market value of $20 or less per source per occasion, provided that the aggregate market value of individual gifts received from any one person under the authority of this paragraph (a) does not exceed $50 in a calendar year."

5 CFR 2635.204(a) (eCFR, up to date as of October 27, 2026). Read October 29, 2026.

The same rule says a greeting card isn't a gift at all, and that the employee "may not pay the excess value over $20". States and cities set their own lines: New York's municipal rule is "seventy-five dollars or more" where influence "could reasonably be inferred". All of it: gifts to federal employees.

Company policies matter too. The most recent survey we found is old: in a 2013 survey by SAI Global, a compliance-software company, reported by Ogletree in 2014, "35 percent of companies require that corporate gifts be" modest, "defined as under $25" (Ogletree). Ask the recipient's office before you send.

This is information, not legal or tax advice. Check the current rule (or check with the recipient's agency ethics official) before you send.

Your Trade's Rules: Finance, Mortgage, Insurance, Health and Law

Broker-dealers. FINRA Rule 3220 bars gifts "in excess of $300 per individual per year" to another firm's people "in relation to the business of the employer of the recipient", and the rule "does not apply to… gifts from a member or an associated person to individual retail customers" (FINRA Rule 3220, version "Mar 30, 2026 onwards"). It was $100 until March 29, 2026. Timeline and valuation: FINRA Rule 3220 explained.

Mortgage, title, inspections, agents and attorneys. Regulation X: "No person shall give and no person shall accept any fee, kickback or other thing of value pursuant to any agreement or understanding, oral or otherwise" to refer settlement business (12 CFR 1024.14(b)). The CFPB adds that there is no exception "solely based on the value of the gift or promotion". More: RESPA Section 8 and gifts.

Insurance agents. State statutes set the line: New York, "not exceeding twenty-five dollars in value" (Ins. Law 2324(a)); Florida, "a total value of $100 or less per insured or prospective insured in any calendar year" (Fla. Stat. 626.9541). Every state we checked: insurance agent client gifts.

Health care. For Medicare and Medicaid patients, the HHS OIG reads "nominal value" as "no more than $15 per item or $75 in the aggregate per patient on an annual basis" (OIG, 2016). For an entity's gifts to physicians, CMS sets the Stark limit at $535 for 2026.

Lawyers and CPAs. ABA Model Rule 7.2(b)(5) allows "nominal gifts as an expression of appreciation that are neither intended nor reasonably expected to be a form of compensation for recommending a lawyer's services"; the AICPA's test for attest clients is whether a gift is "reasonable in the circumstances". Neither names a dollar amount.

This is information, not legal or tax advice. Check the current rule (or check with your compliance officer) before you send.

What Changed in 2026

The date at the top of each rules page is the date we last re-read its sources.

This is information, not legal or tax advice. Check the current rule (or ask your tax professional) before you send.

A 2-Minute Check Before You Send

1. Who receives it? Government staff, a company with a gift policy, or a Medicare patient: check their limit first.
2. Who gives it? If your trade has its own rule (finance, mortgage, insurance, health, law), read its row above.
3. Is the recipient a referral source? In settlement services, RESPA has no value exception.
4. What else did they get from you this year? The IRS $25, FINRA's $300 and several insurance caps count the whole year.
5. Keep a record: recipient, their business relationship to you, date, item and cost. Pub. 463's Table 5-1 lists "Cost of the gift. Date of the gift. Description of the gift."

The longer version, row by row: client gift limits by industry.

What to Know Before You Order

• Gift limits. Each box is $35, delivered: the mug, the treats, the gift box, the card, the packing and the shipping, in one figure. Some employers and industries cap the gifts their people may accept; the limits are quoted above, each from its source.
• Where we ship. The lower 48 states and Washington, DC, except Texas for now. No Alaska, Hawaii, Puerto Rico, other US territories, APO/FPO or international. The order page flags any row we can't ship to, so you can fix it or take it out.
• The treats. LINDOR truffles contain milk, soy and barley malt (gluten); read the labels. The Ghirardelli cocoa and the truffles come packed inside the mug.

Where Personalized Gifts Delivered Fits: One Price, One Box Per Person, One Record

Personalized Gifts Delivered sends a $35 logo mug gift box to each person's own address, from one address list. No minimum: one box is a complete order, with no setup fee and no sales tax added at checkout. You see the mug and every person's card before you pay.

When the boxes ship, you get one email with a spreadsheet of recipient, ship date, carrier, tracking number and $35 per box: one row per person, an itemized record for your files. Every box on an order holds the same things: an 11 oz white ceramic mug with your logo printed small, Ghirardelli premium hot cocoa, 4 Lindt LINDOR milk chocolate truffles, black tissue closed with a gold "Happy Holidays" seal, a matte-black gift box with a magnetic lid, and your printed card in an envelope closed with a gold wax-seal sticker. What's in the box and what the price includes: our FAQ.