USA Referral Fee via Giftcard

[Arnie Cilliers]

I have a small business (Single Member LLC) and recently paid an acquaintance a referral fee for business he sent my way in the form of a gift card.

How do I account for this on my books and what are the tax implication for myself?

Does this qualify under the $25 per person per year allowance for gifts?
or
Is this simply a "Referral/Commission" Expense line item on my income statement?

Thank you

 

[kirby]

It is the latter.