Gifts Are Not Income
If you get a gift card as an actual gift -- as a present from a family member or friend, say -- then it's not taxable income. You don't have to report it or pay taxes on it. There is such a thing as gift tax, but it's paid by the person giving a gift, not the recipient, and it's unlikely that a gift card would trigger it. As of 2015, for example, the federal gift tax applied only in situations where one person gave another person more than $14,000 worth of gifts in a single year.
Cards Are Fringe Benefits
Things are considerably different when a gift card comes from an employer. Under the tax code, there's really no such thing as a "gift" from an employer to an employee. Gift cards given out to workers are considered fringe benefits -- that is, non-wage compensation for the performance of services. Fringe benefits generally count as taxable income except when they are specifically excluded from taxation, which is the case with health benefits, or when they are what the IRS calls "de minimis" fringe benefits. These are benefits that are of such small value or are provided so irregularly that it wouldn't be practical for the company to try to assess the value to each individual employee.
De Minimis Exception
De minimis fringe benefits from an employer include things like free coffee on the job, flowers on your birthday, tickets to an occasional sporting event or personal use of company equipment. Though a gift card may be of seemingly small value, the IRS has stated unequivocally that "cash equivalents" are always considered income. The question, then, is whether a gift card is a cash equivalent. It depends on the type of card. If the card can be redeemed for your choice of merchandise from the retailer that issued it, then it's a cash equivalent and is taxable. But if the card can be redeemed only for a specific item, and that item would itself qualify as a de minimis benefit, then the card may not be taxable.
Reporting as Income
Employers are responsible for reporting taxable fringe benefits paid to employees. They will be included on Form W-2, your annual wage and tax statement. Employers can also pay fringe benefits to non-employees, such as independent contractors. For example, a freelancer who gets a cash-equivalent gift card from a client is receiving a taxable fringe benefit. It's that freelancer's responsibility to report the value of the card as income.