Just like OSEP and other federal and state grantors allow a De Minimis indirect rate, the IRS allows for De Minimis Fringe Benefits. If you choose something allowable, keep clear records and follow a standardized process to substantiate need, you can still, occasionally incentivize your staff without taxation or reporting. Learn more about what is allowed here: https://www.irs.gov/government-entities/federal-state-local-governments/de-minimis-fringe-benefits