Note: These instructions do not apply to gifts given by the United Way because the United Way takes a portion of each gift and does not disclose all donors. For instructions on tracking gifts from the United Way, refer to How to track United Way gifts (BB75014).

 

Organizations sometimes write a check on an employee's (or other individual's) behalf. Two of the most common examples of this are:

 
     
    • The employee donates through a payroll deduction.
     
    • The organization matches gifts. Instead of the employee sending in a separate check, the organization sends in the check for both the employee's gift and the organization's matching gift.


     

    When this happens, there are two different ways you can enter the gift. Each way has its pros and cons. The way you enter it is determined by your organization. We recommend you adopt a consistent approach.
     

    Entering the entire gift on the organization's record:

     

    The reasoning behind this is that it is the organization's check so they are literally the donor. However, you need to be careful not to receipt them for the full amount for tax purposes. The drawback to this approach is that you cannot run receipts for the individuals' gifts in Mail, Receipts, and the individuals are not hard credited for the monies that they actually donated.

     

    However, as of 11.19.2004, per IRS Publication 526, the individual does not need to receive a receipt from your organization for tax purposes even for single gifts above $250:

     
     

    Payroll deductions. If you make a contribution by payroll deduction, you do not need an acknowledgement from the qualified organization. But if your employer deducted $250 or more from a single paycheck, you must keep:

     

    1) A pay stub, Form W-2, or other document furnished by your employer that proves the amount withheld, and

     

    2) A pledge card or other document from the qualified organization that states the organization does not provide goods or services in return for any contribution made to it by payroll deduction.

     

    Note: We cannot give out tax advice nor can we guarantee that IRS rules and Publication 526 will not change. For tax considerations, refer to your accounting department or a qualified CPA.

     

    To record it this way:

     
         
      • Enter the entire amount in the Amount field.
       
      • Enter only the amount the organization is actually funding itself in the Receipt amt field.
       
      • On the Soft Credit tab, enter each individual's name and the amount they have given.
       
      • Enter all other appropriate information.
       
      • Click Save and Close.
       

       

      Entering a gift on both records (or just the individual record if the organization did not actually fund part of the gift):

       

      The reasoning behind this is that the individual actually funded the gift so he should receive a hard credit for the amount that he contributed. This also allows you to run receipts in Mail. The drawback to this approach is the amount of data entry work that is required.

       

      To record it this way:

       
         
        • Add a gift to each constituent record that donated through the organization. Also add a gift to the organization's record if the organization funded any of the gift.**
         
        • Enter the amount that the constituent actually funded in the Amount field.
         
        • Enter this same amount in the Receipt Amount field.
         
        • Enter any other appropriate information.
         
        • Click Save and Close.


         

        **If the organization's portion of the gift is a matching gift, you may want to take advantage of the matching gift functionality inherent in The Raiser's Edge. To do this, instead of adding a gift directly to the organization's record, enter the organization on the Matching Gifts tab of the individuals' gift records. For instructions, refer to How to add a matching gift pledge (BB46624).