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Tax Receipt/Letters

  • 1.  Tax Receipt/Letters

    Posted 20 days ago

    Hello,

     

    I am being told that tax receipts are only required for those with payroll deduction. In the past, we have sent at letter and gift receipt summary for the calendar year to everyone that gave cumulatively over the minimum required for tax purposes. I have been asked to put this inquiry out to this group.

     

    Am I required to send a gift summary out to every giving over $300 for the year? Or only those that do not regularly receive gift receipts with each gift?

     

    Thank you.

     

    Denise Mattie

    Director of Advancement Services

    Division of Institutional Advancement | Maedgen #209

     

    McMurry University

    1 McMurry University | #938 | Abilene, TX

    325-793-4750
    mcm.edu | give.mcm.edu 

    68270171-ac72-4324-9093-1b37b968f2da

     



  • 2.  RE: Tax Receipt/Letters

    Posted 20 days ago
    The rules are that if someone wants to claim a tax deduction for a gift of over $250, they must obtain a receipt.  However, the language is such that the nonprofit organization does not have to issue any receipt unless the donor requests one.

    But that is the worst possible donor relations!

    One exception to this law is that if there is a QPQ, we must issue a receipt no matter what if the full payment is $75+.

    An exception for payroll deduction donors allows them to use their W-2 or similar document for deductions of under $250 as long as that document has the "no goods or services" language.

    I believe all donors deserve a receipt within 48-hours of a gift being processed.  However, if they are on some monthly recurring giving plan, an annual receipt for those gifts is best - as long as you tell them that in advance.

    If you send out receipts to donors during the year, no year-end summary is required.  That's just a lot of extra work.  And I'd hate to wait up to 12 months to thank a donor - hence the above 48-hour suggestion.

    John

    John H. Taylor
    Principal
    John H. Taylor Consulting, LLC
    2604 Sevier St.
    Durham, NC   27705
    919.816.5903 (cell/text)

    Serving the Advancement Community Since 1987






  • 3.  RE: Tax Receipt/Letters

    Posted 20 days ago
      |   view attached
    Denise, I have attached a highlighted copy of IRS Publication 1771.  The highlighted sections on pages 2, 3, and 6 address the main issues in this email thread.

    John

    John H. Taylor
    Principal
    John H. Taylor Consulting, LLC
    2604 Sevier St.
    Durham, NC   27705
    919.816.5903 (cell/text)

    Serving the Advancement Community Since 1987





    Attachment(s)



  • 4.  RE: Tax Receipt/Letters

    Posted 11 days ago
    John,

    I am searching for the answer to a similar question -- Every year, we mail an annual tax receipt letter to all our donors, regardless of size of gift. Now we are possibly amending to only mail a 2021 annual tax receipt letter to donors with an calendar year total giving of $100 or less in cash gifts -- it seems from the conversation above and parts of IRS pub 1771 you highlighted that we are well within that bracket, but I wanted to verify because here we are talking about a cumulative (12 mo) total of $100 or more, whereas IRS pub 1771 seems to emphasize a single gift of $250 or more. Is the answer the same? Not necessary for a "total of" $250 in cash gifts during the year 2021?

    ------------------------------
    Melissa Rufener
    Coordinator of Advancement Services
    Life Pacific University
    mrufener@lifepacific.edu
    http://www.lifepacific.edu
    ------------------------------



  • 5.  RE: Tax Receipt/Letters

    Posted 11 days ago
    No gift receipt is required for any single gift of under $250 unless a QPQ is involved.  The IRS does not discuss cumulative giving.

    And other than QPQ, you are not required to issue ANY receipt unless a donor asks for one.  But, in my mind, not acknowledging a gift is not a good idea.

    John

    John H. Taylor 
    919.816.5903 (Cell/Text)

    Big Ideas; Small Keyboard





  • 6.  RE: Tax Receipt/Letters

    Posted 11 days ago
    Thank you! This helps.

    ------------------------------
    Melissa Rufener
    Coordinator of Advancement Services
    Life Pacific University
    mrufener@lifepacific.edu
    http://www.lifepacific.edu
    ------------------------------