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Emailing Your Institution’s Donor Receipts

The IRS says, “A donor claiming a deduction of $250 or more is also required to obtain and keep a contemporaneous written acknowledgment for a charitable contribution. To be contemporaneous the written acknowledgment must generally be obtained by the donor no later than the date the donor files the return for the year the contribution is made. The written acknowledgment must state whether the donee provides any goods or services in consideration for the contribution. If the donee provides goods or services to the donor in exchange for the contribution (a quid pro quo contribution), the written acknowledgment must include a good faith estimate of the value of the goods or services. The donee is not required to record or report this information to the IRS on behalf of a donor. The donor is responsible for requesting and obtaining the written acknowledgement from the donee. Although there is no prescribed format for the written acknowledgment, it must provide sufficient information to substantiate the amount of the contribution.”


Your institution’s written statement to donors should contain:

· The name of organization

· The amount of cash contribution

· A description (but not the value) of non-cash contribution

· A statement that no goods or services were provided by the organization in return for the contribution, if that was the case

· A description and good faith estimate of the value of goods or services, if any, that an organization provided in return for the contribution

· A statement that goods or services, if any, that an organization provided in return for the contribution consisted entirely of intangible religious benefits (described later in this publication), if that was the case


In 2018, the IRS clarified that “written communication includes email”…


Treasury Regulation 1.170A-15:

(a) In general.

(1) Bank record or written communication required. No deduction is allowed under sections 170(a) and 170(f)(17) for a charitable contribution in the form of a cash, check, or other monetary gift, as described in paragraph (b)(1) of this section, unless the donor substantiates the deduction with a bank record, as described in paragraph (b)(2) of this section, or a written communication, as described in paragraph (b)(3) of this section, from the donee showing the name of the donee, the date of the contribution, and the amount of the contribution.


(b) Terms.

(1) Monetary gift includes a transfer of a gift card redeemable for cash, and a payment made by credit card, electronic fund transfer (as described in section 5061(e)(2)), an online payment service, or payroll deduction.

(2) Bank record includes a statement from a financial institution, an electronic fund transfer receipt, a canceled check, a scanned image of both sides of a canceled check obtained from a bank website, or a credit card statement.

(3) Written communication includes email. [underline added]

EXAMPLE: Aerie College in Eagle, CO had over 2,000 separate donors give to them in their most recent tax year. Mailing donor receipts represents a fairly substantial investment in people’s time, paper/printing costs, and postage. They could save over $1,000 in postage alone by “switching” their method of donor communications to email. Would that be feasible? Would donors complain?


For more information, check out:


IRS Publication 1771, Charitable Contributions – Substantiation and Disclosure Requirements


https://www.abhe.org/donor-receipting-is-email-okay/

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Moja & Company

P.O. Box 531

Reidsville, GA 30453

321.258.9907

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