Create Your Order Receipt Sample for NPOs Easily

Order receipt sample for NPOs

[Music] hi I'm C Ray founder of Sandra eay CPA where we alleviate Financial headaches so that you can create a bigger impact today I want to talk about donation receipts as nonprofit professionals you face multiple demands on your time and you're under lots of pressure it's easy to think that donation receipts aren't important or that they only matter because the IRS requires them but that's not true donation receipts are important yes they help you cover your basis with the IRS but they can also help you track your donations and build successful donor relationships prompt and thoughtful thank you letters are Central to effective fundraising so why do donation receipts matter to donors they let donors know that you have received Their donation everyone who's purchased something online has that moment of question it's like did my payment go through essentially your receipt lets the donor know that you've received the donation and all as well donation receipts help donors track their finances and if the donation is in excess of $250 the donor must have a written acknowledgement before they can claim that donation on their income tax return for federal purposes plus a donation receipt is a chance for you to show that your organization is responsible transparent and most of all grateful for their support so why do donation receips matter to our organizations donations reduce the tax owed by the people in the businesses that donate because of this the government is encouraging donations by providing receipts you let the donors know that their contribution is tax deductible it also makes donors feel appreciated and acknowledged increasing their trust and their loyalty proactively sending out donation receipts is key to building long lasting relationships with your donors it's a perfect opportunity to show your appreciation and think about this for a firsttime donor this may be their first interaction with your organization and it could have a huge impact on whether they decide to support your organization in the future so when do donation receipts have to go out well there's virtually no rules about when you must send out an official donation receipt many nonprofits send out receipts out yearend for tax receipts in January and February of the following year but donors expect to receive a thank you for their contribution no matter what the size and they expect it soon after they make the gift so it's advised to send out a donation acknowledgement within 24 to 48 hours of the donation being made now this can be achieved through automating the process in issuing donation receipts and those automations may vary depending on the size of the donation if you're running a campaign a texting campaign where you receive a $10 contribution that automation may just be a reply as a text if you're receiving a check for $10,000 or a stock gift for $10,000 that automation may be a letter that is sent to the executive director and or board members for them to personally sign and mail out now the IRS requires donation receipts for certain situations we're going to cover those a little bit of course the one we all know is donations of $250 or more need a tax receipt but we also require to do tax receipts when donors give us a donation and we in turn give them something worth $7 $5 or more we're talking about those gifts those thank you gifts you know like we've all seen PBS give out t-shirts and mugs and other things at different giving levels those have to that value if it's $75 has to go on that receipt and then finally whenever a donor asks we are required to give them a receipt there's no legal requirement for gift acknowledgements for contributions of less than $250 unless the donor receives something of value as we discussed so what does the IRS require on a donation receipt the first thing is the name of the organization that received the donation a statement that you are a public charity recognized as a tax exempt organization under IRS code section 501c3 the name of the donor the of the donation the amount of the cash contribution now if this is a non-cash contribution you need a description of the item but not the value that's the donor's responsibility the amount of crypto or stock donation you need a description and good faith estimate of the value of goods or services that you provided to the donor in exchange for their gift again another example is a $100 meal for a $500 a plate Gayla or you need a statement that says no goods or services were received in return for this gift now one thing I want you to be aware of hopefully you are if you receive a non-cash gift valued at $5,000 or more you must have a signed appraisal and if you sell any donated property that has a value of $500 or more within three years of receiving the gift you must file a form 8282 dony information return now this goes into the IRS it goes to the donor so that they know that there was a difference between the donation that was claimed and what you ended up selling it for three years later the exception to the form 8282 is if the property was distributed for charitable purposes for example say you received a donated vehicle you then in turn gave that vehicle to a constituent so that they could obtain or retain a job or attend college or whatever else they needed that vehicle for that's part of your programming now if your organization provides intangible religious benefits be sure to include a statement like the organization provided intangible Rel ious benefits or services to donors another thing you might want to include is your mailing address and your ti number your tax identification number your employer identification number they're kind of interchangeable although those are not required many donors need them for their tax return purposes and I want you to be careful about yearend cut offs when we're talking about donation dates the day the charity receives the donation is the donation date for Ma's donation such as a check that's the postmark date not the check date not the day that the check arrived in the mailbox at your office for online transactions it's the transaction date not the settlement date and for donations delivered to your site it's the delivery date make sure you report the corre correct date on your donor receipt for a complete listing of the IRS requirements see publication 1771 charitable contributions substantiation and disclosure requirements now I have included a link to this in the description of this posting so you can just go there or you can go to the IRS website and type in Pub space 1771 it'll come up so let's talk about yearend tax receipts that's the time of the year that's prompting this conversation sending out year in tax receipts is a great way to thank your donors to acknowledge how much their donations mean to you it's a convenience for your donors so that they have ease of recordkeeping for tax purposes but it's also a great opportunity for you to set the stage for giving for the upcoming year and although it's not mandatory to send year in tax receipts it's a nice gesture and it makes tax time easier for your donors so moving forward donation receipts can be confusing and timec consuming but they're important part of your nonprofits fundraising efforts make sure that you familiarize yourself with the donation receipt requirements and then invest in some tools that make the process easier for you this will give you time time for interacting with your donors I hope this was helpful and I want to thank you for joining me today remember that creating a bigger impact starts with stopping the nonsense if you're dealing with nonsense in your nonprofit organization we'd love to help you cut through the noise