If you’re like most CFOs, you are on the board of one or two non-profits; maybe on the leadership council of your place of worship. You are considered an expert. Don’t mess this one up. When providing a receipt for cash or checks received from your donors the non-profit must comply with all of the following for donations greater than $250:
1) It must be dated before the donor files their return, the due date of the return, or, if they obtain an extension, the extended due date;
2) The date(s) of the donation must be listed. If not listed, the donor may use a dated receipt or bank records;
And, THIS IS THE ONE SOME NON-PROFITS MISS,
3) The statement must specify the value of any goods or services from the non-profit that were received by the donor. This seems like a no-brainer, but if a place of worship does not state “the only benefits received are intangible religious benefits, such as admission to religious ceremonies“, the IRS may deny the deduction and the donor will have no recourse. Likewise, all non-profits must make a statement of the benefits. But, you don’t need to go overboard. I donated money to the Kidney Foundation to have a brick placed with my Father’s name and I received a statement saying I received $80 of benefits that included the brick and a monthly newsletter I didn’t care if I received. The IRS states that “”token” items and other certain membership benefits do not have to be described or valued. This includes anything that cost the non-profit less than $9.90 (which I sure the brick did), and membership benefits like newsletters. Check IRS.gov for details; don’t just take my word for it. Do your due-diligence.
If you are a CFO helping out a non-profit, don’t let them down by missing important IRS requirements. You may not claim to be a tax expert, but you represent your Company in the community and it will be assumed that you are capable, so either prepare yourself or don’t volunteer.