A. If an employee received tangible personal property (other than cash, a gift certificate, or an equivalent item) as an award for length of service or safety achievement, you generally can exclude its value from their income. However, the amount they can exclude is limited to your employer's cost and cannot be more than $1,600 ($400 for awards that are not qualified plan awards) for all such awards they receive during the year. The award must be part of a meaningful presentation, under conditions and circumstances that do not create a significant likelihood of it being disguised pay (IRS Pub 525.)