In-Kind and Stock Donations

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There may be times when a donor wants to give something other than a check, cash, or ACH bank transfer donation. The two most common alternative donation types are "in-kind" donations and stock donations.

Notice

The information in this article is not advice. If you have any questions about the legal or tax implications of a donation, always contact a licensed accountant for advice – preferably one that specializes in working with non-profits.

IRS regulations for non-profits

If you're in charge of bookkeeping or accounting for a non-profit in the United States, you should familiarize yourself with the IRS regulations that govern donations to non-profits. Here are some good resources for that information.

In-Kind Donations

Non-cash donations are typically called "in-kind" donations. They are goods or property given by the donor to your church. If the donor intends to deduct an in-kind donation from their taxes, they must obtain a written acknowledgment from your church to substantiate what was given.

Caution

The IRS expressly forbids the charity from declaring a value for the items received. The burden of determining the dollar value of the items is on the donor themselves.

In your church's written acknowledgment, it is a best practice to include the name and EIN of your church, the date received, and a detailed description of the in-kind donation.

Planning Center Giving does not track in-kind donations. However, issuing an acknowledgment of an in-kind donation is as simple as sending a letter or email to the donor. A common template churches use, reads as follows:

Thank you for your generous gift of [description of item(s)] which we received on [date]. Your generous contribution will help to further the important work of our organization. No goods or services were provided in exchange for this contribution other than intangible religious benefits.

Notice

Here's a helpful article about in-kind donations: In-Kind Gifts: How to Acknowledge and Recognize Them.

Stock Donations

If your church has a brokerage account that has the ability to receive shares of stock, then this transfer needs to be accounted for outside of Planning Center Giving. Giving does not have the ability to track donations of unliquidated shares.

If your church receives a check or a bank transfer that has a fixed dollar amount, then this donation is typically considered a cash donation – even if the money came from the sale of stocks, bonds, or other investments.

As always, talk to a professional about the tax advantages or disadvantages of accepting stock donations.

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