Organizational Structure

Gift Acceptance

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A gift acceptance policy allows the board to define the parameters and guidelines for eliminating controversial or risky donations. Unwelcome donations might include gifts that:

  • don’t relate to the mission of the organization
  • don’t cover all the necessary costs of a program or project
  • come from a source with which the organization should not be affiliated
  • come with too many strings attached
  • could cause the organization fail the public support test or otherwise lose its tax-exempt status
  • would be too complicated to manage or oversee

 

A gift acceptance policy should indicate how the organization handles:

  • in-kind donations (art, real estate, cars, furniture, unneeded or irrelevant items)
  • appreciated and/or closely-held stock
  • corporate sponsorship agreements
  • bequests, life insurance policies, various trust agreements

 

The board must ensure the organization understands legal obligations for gift recognition.

  • Gifts of $250 or over must receive a receipt to be deductible.
  • The organization is responsible for defining the deductible amount i.e. indicating whether the donor receives something in return and indicating its monetary value.
  • Token benefits (valued at $9.10 for donations of $45.50 or more in 2008) can be disregarded.
  • For gifts of $50,000 or more the IRS can substantiate the fair market value to facilitate deductibility.

 

For the contributors of $250 or more to receive their tax deductions, the organization must provide receipts. A receipt must include:

  • the name of the donor
  • the date when the donation was received
  • the amount or description of the item donated
  • a statement indicating whether any goods or services were provided in return for the gift
  • a good faith estimate of the value of goods or services provided to the donor The receipt should not indicate the estimated value of the donation; that is the responsibility of the donor.