You say he is "smart" and "capable." Do you mean he is very verbal? Talks a lot, knows the answers, great at conversation, uses excellent vocabulary, etc., etc., but has trouble with the WRITTEN work? If that's true, there could be many explanations: reading disability, writing disability, visual problems, or simply the boredom that comes from trying to sit still and do paperwork! My advice is to stay very low-key as you maintain your expectations for him WHILE you investigate potential problems. I've learned that kids' behavior is often their way of telling us something ... we just have to figure out what in the world they're trying to tell us!! Rather than just assume your son "won't" do it, be sure he "can" do it ... do you know what I mean?
Also, I would be careful about offering new toys or really special things on the condition that he "do better" in school. If this is something he can't control (like a reading or writing disability), he may become very frustrated because he badly wants to do whatever you're asking him to do (and he badly wants the toy!), but he literally cannot do it. That would frustrate ME, I know. Take the time, ask the school or doctors to evaluate, rule out all those bigger issues. THEN set up some kind of reward system for very specific achievements. And remember, in the end, he is your boy. Continue to celebrate the things he does right, and give him the opportunity to shine when you can. None of us like to do things that are hard for us. Why should he be any different?
Have a great week!
Geri