Acknowledgement Letters: IRS Non Deductible Amnt

If I understand correctly, Donor B gave a gift that was not large enough to qualify for a membership, and then subsequently (in the same fiscal year, I imagine) gave a second gift.  If you add the two gifts together, you get enough for a membership.  Right?  And I take it your business practice is to automatically give a membership when the money reaches the right level.

The first thing I would do is determine if the donor wants a membership (and the resulting benefits).  Sometimes they just want to make a gift!

If they do want a membership, you need to check on how you recorded the first gift.  If you put it in a general fund, you might want to reclass it as membership, then when you add the second gift it will trigger the membership record (like the membership update process works now).  Since you have already sent a tax letter deducting the full amount of the first gift, none (or only a small amount) of the second gift would be deductible since it all goes to “purchase” the benefits.  Or, you could mark the letter as “Revised Receipt” and show both gifts with the non-deductible amount.

Here is the language we include with our membership cards.  The values are drawn from the ack_ltr report.

Your gift of $ MERGEFIELD "recd_amt" «recd_amt» made on  MERGEFIELD trn_dt \@ "MMMM d, yyyy" «trn_dt», less the value of goods and services received ($ MERGEFIELD "goods_services_value" «goods_services_value»), is deductible to the fullest extent of the law.

I’d be happy to chat offline if you want more details.