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Bulk donation from community partner - how to credit individuals
2 CommentsSorted by Oldest First
You could Hard Credit the individuals and then soft credit the Health Club for all of the gifts. But I don't think I would do that.
Technically (I think) the Health Club gets the tax deduction on their books because the money was passed through them. When they are reporting revenue at the end of the year they will most likely count that extra money as income and then the check to you would be marked as a charitable donation counting against their taxes.
We would usually hard credit the organization on the check and then soft credit each individual who contributed so that we could send them a letter. If this was, say, a payroll contribution the company would send the employee a tax notification and we would only send an acknowledgement letter (with no tax language) to the individual since that money didn't come directly from them.
If, however, during the event people wrote checks to your organization that were then collected and sent to you we would HC the individual and maybe SC the organization (or make them a solicitor) to indicate that they helped to raise the money. I think the fact that the money passed through the organization's bank account and the check was made from the organization the IRS would consider them as the tax beneficiary and not the individuals.
Again though, I am not a legal or tax professional so this is just my opinion!
Technically (I think) the Health Club gets the tax deduction on their books because the money was passed through them. When they are reporting revenue at the end of the year they will most likely count that extra money as income and then the check to you would be marked as a charitable donation counting against their taxes.
We would usually hard credit the organization on the check and then soft credit each individual who contributed so that we could send them a letter. If this was, say, a payroll contribution the company would send the employee a tax notification and we would only send an acknowledgement letter (with no tax language) to the individual since that money didn't come directly from them.
If, however, during the event people wrote checks to your organization that were then collected and sent to you we would HC the individual and maybe SC the organization (or make them a solicitor) to indicate that they helped to raise the money. I think the fact that the money passed through the organization's bank account and the check was made from the organization the IRS would consider them as the tax beneficiary and not the individuals.
Again though, I am not a legal or tax professional so this is just my opinion!
Thanks, Wayne, I appreciate your response! It makes a lot of sense with your way, since IRS-wise, the health club cut the check.
Joanne Danganan
Our organization hosted a series of events at one of our community partner's headquarters (a health club) where we solicited donations from their members. The members had the option of donating through their club account, after which the health club cut us a check for the total amount.
The check is from the health club, but the donations come from the individuals. How do I record this in Raiser's Edge? In my and my colleagues' eyes, the health club receives no tax reduction but its individual members who donated do. However, their contribution is tied to the health club's check.
How is crediting done in this situation? I was thinking of hard crediting the donor and listing the health club as the solicitor. The pay method would be "business check" with the check number and date the same across all individual donors. Is this incorrect?
How would you record these gifts?