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Bank receipt generator for non-profit organizations

thank you for joining quick tips for nonprofits today's quick tip will focus on donations and donation receipts Community Law Center is a legal services provider for nonprofit organizations and community organizations throughout Maryland Community Law Center can help nonprofits with a variety of legal issues everything from entity formation board governance and necessary filings to issues with property zoning contracts employment nuisance issues liquor board matters intellectual property and many other matters today's quick tip is just for informational purposes and should not be construed as legal advice which really should be tailored to your organization if you wish to become a client of the Community Law Center your organization can submit a simple application many nonprofits are unfamiliar with best practices for keeping records of various donations and may be unsure of what needs to be provided in receipts for donations in various situations we will cover these donation issues to start off there are different types of donations than nonprofits may receive monetary and non-monetary or in-kind donations monetary donations are what you might expect including cash checks and more PayPal and most organizations do make sure to keep records of these monetary contributions and have some kind of fiscal policy but they may not be as sure of what to do with in-kind donations in-kind donations are non-monetary goods or services and an example of goods would be if a cafe donates refreshments for one of your events goods can also include the loan of something such as someone letting you use equipment or office space in kind goods should be recorded with date and donor name as usual but also for your own records you should know the reasonable fair market value of those goods so for example for the cafes refreshments you can refer to their menu prices or for equipment rental you should note how much the rental would usually cost or what normal rent for office space is in our examples this value is not affected by whether or not the organization could have afforded to pay this for larger revenue nonprofits who file the IRS Form 990 in-kind goods donations are required to be reported on the 990 besides goods for in-kind services not every service provided by volunteers necessarily needs to be recorded but if it was an entity that provided the service you will want to record the service or if the service was such that would normally require payment such as professional accounting legal assistance or other such services or if the service added to or enhance the value of your own organization in-kind services should be recorded sometimes a funder may request information about in-kind donations because in-kind donations can reveal a lot about your support from the community and your impact in the community now we get to the question of receipts when do nonprofits need to provide donation receipts and what information needs to be included there are two main scenarios to be aware of with receipts first is where a simple donation was made with no quid pro quo meaning that you gave nothing of value in return for these donations you should be able to give a receipt especially if the donation was over $250 in the second scenario where something was given in return for donations over $75 with quid-pro-quo you are actually required to give a disclosure so we'll talk first more about receipts and then we'll move on to disclosures 501 C 3 organizations attract donations in part because donors contributions to you are tax-deductible for them but for each donation over $250 the IRS requires the donor to have a receipt describing the donation the organization's name and the date of the donation and when you give these receipts it should also state that nothing of value was given in return for the donation or if you're a religious organization that only intangible religious benefits were given if you received a non-monetary donation please do not estimate a value in your description of the donation so for example on the receipt under description you can just say 8 used epson inkjet color printers determining fair market value can get complicated depending on the type of the item and condition that the item is in and thankfully this is not your responsibility some donors may ask you for a receipt even if the value of a non-monetary contribution was well under $250 and that's because non monetary donations require more of these kinds of records moving on to disclosures if you did give something of value in return for a donation that was over $75 you are required to provide a disclosure your disclosure should describe the donation the name of your organization the date that the donation was given as well as the fair market value of what you gave in return for that donation and you should also include a clear statement that only the difference of the donation and the value received in return may be tax-deductible so for example if you were offering a gift basket worth $60 and someone provided a 90 dollar donation and received that gift basket then only 90 minus 60 which is 30 dollars would be tax-deductible for them you may be subject to penalties if you fail to provide these disclosures so please do give the disclosure if not when you receive the contribution then at least when you solicit the contribution please contact us with questions there are some additional details that we couldn't cover in quick tips such as if you receive donations of vehicles there are other disclosures that you need to provide we can help you draft a form receipt to cover all the donation scenarios in that your organization encounters thanks for taking checking out today's quick tip please visit our website community law org you can see our workshops on a variety of topics you can access helpful publications and find more quick tips if you would like to speak with an attorney we are offering brief legal advice over the phone so please sign up on our website or if you're ready to receive legal assistance on a matter you can find our application to download and submit as well take care