Date: 08/06/2008

On July 30, 2008, the U.S. Tax Court ruled on a case involving a series of gifts to a church (all gifts were in excess of $250) in which the gifts were deemed not deductible by the taxpayer simply due to a failure by the church to provide a contemporaneous written gift receipt that contained the mandatory statement regarding whether goods or services were provided in exchange for the gifts.  This is a very narrow and technical reading of the law.  While many legal commentators do not like the decision, it underscores the need for churches to be more conscientious in providing timely and accurate gift receipts. 

 

To read a summary of the court’s decision click here.  To review sample gift receipt letters click here. 

 

For regular givers, the Foundation recommends at least quarterly gift statements (monthly are preferred) that contain gift amounts, dates received, and the appropriate magic words mandated by the IRS.  Special one-time gifts in excess of $250, gifts of property (land, stock, personal property), and any unusually large gifts merit special treatment with a personalized and timely thank-you/gift receipt letter.  (To see sample receipt letters for property click here.)  Note: Gift receipts should only state a value for cash gifts.  Property should only be described, not valued.