A quid pro quo contribution is one that is made by a donor in exchange for goods or services. In some cases, contributions may include a quid pro quo contribution and a true contribution, e.g., a ticket for an event that includes a meal. A church or religious organization must provide a written statement to a donor for any payments over $75 when the payment is partly a contribution and partly in exchange for goods or services. This written statement should:
• inform the donor that the amount of the contribution that is deductible for federal income tax purposes is limited to the excess of the money contributed by the donor over the value of any goods or services provided by the charitable organization, and
• provide the donor with a good-faith estimate of the value of goods or services furnished by the charitable organization.
For example, if a donor gives the church $100 and receives a concert ticket valued at $40, the donor has made a quid pro quo contribution.
***This sample is provided solely for informational purposes. Nothing in this document constitutes legal advice.***
[INSERT First Sample Church LETTERHEAD]
Note: If an organization receives a donation in excess of $75.00, and gives the donor something in return, then it must disclose to the donor the value of the goods or services provided.
[INSERT DATE]
Dear [INSERT INDIVIDUAL’S NAME], Thank you for your recent contribution to First Sample Church, a 501(c)3 organization with the mission of [INSERT MISSION]. We gratefully acknowledge your contribution of $100 [SAMPLE AMOUNT], made during the benefit held on [DATE]. The fair market value of food and entertainment provided to you at the benefit is $50 [SAMPLE AMOUNT].
For income tax purposes, the donor may deduct only the amount by which the contribution exceeds the fair market value of such goods and services. Therefore, $50 of your contribution is tax deductible to the fullest extent permitted by law.
With your support, we will continue to [DESCRIBE MISSION/GOALS].
I thank you for being an active supporter, for believing in the importance of our mission and for your commitment to our work and vision of a better world.
[NAME]
Secretary of the Board of Directors
First Sample Church
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