If your member association is receiving donations for a specific project, or donations in memory of a club member, you must:
- Acknowledge the donation in writing to the donor, and if needed state the purpose for which they donated the funds.
- Make a paper copy of the check or Paypal receipt for the Club’s records. According to the IRS only those donations of $250 or more are reported on the annual 990 report.
- If the donations are made in memory of a club member, the family may also want to thank the donors, so a copy of the name and address of all of the donors is helpful to accommodate the family.
- If the donation is made for a specific project, i.e. 4-H, or the apiary at the local park, then those funds are “restricted funds” and may only be used for the donor’s specified purpose. Restricted funds are NOT part of the general club budget.
Additional donation information
One of the things that clubs need to know is that for credit/debit/check gifts less than $250 the donor can deduct without an acknowledgement from the recipient (their bank draft or card statement will suffice), but for gifts of $250 of more regardless of if it is cash, check, or charge the donor must receive an acknowledgment from the recipient with the statement ” no goods or services . . .” in order to claim the deduction on their taxes.
No matter the type or amount of donation, it is good public relations to acknowledge every donation, whether it is a donation of supplies for the bee yard, or club picnic, or a cash donation no matter the amount.
For property or stocks the rules get more complicated and additional tax forms, as well as appraisals may be required. The nonprofit never determines the value of donated property: a receipt for the donor’s property purchase or an appraisal determines the value.
Additionally, time is of the essence in sending out the thank you letters. As always it is best to check with an accountant knowledgeable in charitable contribution reporting if there are questions, and review IRS publication 1771 ( https://www.irs.gov/charities-non-profits/substantiating-charitable-contributions )
Disclaimer: LEAD for Pollinators is not a CPA or attorney. For legal and accounting advice consult a licensed attorney or accountant.