Is this income to barnie as compensation

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Reference no: EM13143316

Cleveland Co. makes widgets. It has a commission salesman, Barnie, who does a wonderful job. Barnie sells tons and tons of widgets, and earns tons and tons of money as commissions on such sales. At the end of the year, Cleveland Co. sees how much money it made from Barnie's sales, and out of gratitude for doing such a good job, makes a gift to Barnie of a brand new Buick Lesabre. Remember, Barnie was paid on commission, and already has been very handsomely rewarded by Cleveland Co. for the sales efforts he made, as he made a lot of commissions. Cleveland Co. did not have to also give him the car, and did it just out of admiration for Barnie doing such a great job. Is this income to Barnie as compensation, or a nontaxable gift?

Reference no: EM13143316

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