I'm curious as to what other organizations list on their tax receipts/acq letters for gifts of stock. Some people have told me that the IRS allows you to put the stock information on the receipt/letter (for example - name of stock, # shares, hi/low value of stock on the valuation date) but not the exact value that you are crediting to the donor.
Not that I don't believe these people but I'm curious about where they found this information. Can anyone point me to the right place on the IRS website?Thanks,Dale
Hi Dale,
After the conference this year, we took a look at our acks and receipts for stock gifts. I looked for this information on the IRS site for days to no avail. So then I called the IRS and spoke with a representative directly, who also wasn't much help. He told me to include the value on the date received, for instance, "On x date x shares of x stock was trading at x dollar amount with estimate fair market value of x." This is for public stock only. He also said it is okay to use the closing price en lieu of the mean price of the high and low. He wasn't 100% sure though and said this should be fine.
So now, this is what we do ...
In the actual ack letter, we include the following:
Following Internal Revenue Service guidelines, your contribution has been recorded by the Center at $xxx.xx.
On our receipt page, we include the following (not quite sure how it will look here):
Acknowledgement of Charitable Contribution Transfer Date: Allocation: Record of Stock Contributions Stock Name Symbol # of Shares High Low Mean
Acknowledgement of Charitable Contribution
Transfer Date:
Allocation:
Record of Stock Contributions
Stock Name
Symbol
# of Shares
High
Low
Mean
(This chart is pasted from Excel and as all of the fields don't seem to be displaying here, they are: Stock Name, Symbol, # of Shares, High, Low, and Mean)
For recognition purposes, the Center values gifts of securities at the average of the high and low values on the date of transfer. In compliance with the Internal Revenue Service, a charity must determine the market value of benefits and list the deductible and no-deductible amounts for contributions. As the donor has declined benefits, the Orange County Performing Arts Center estimates that this contribution is fully tax deductible.
Please retain this acknowledgement for your tax records.
The Orange County Performing Arts Center advises you to seek your owl legal and tax advice in connection with gift and planning matters. The Center does not provide legal or tax advice. This communication (including any attachments) may not be used for the purpose of avoiding tax related penalties.
The Orange County Performing Arts Center is a non-profit tax-exempt organization under section 501(c)(3) of the Internal Revenue Code - Tax Identification Number 23-7287150.
I hope this helps a little bit. I apologize for not being able to direct you to a specific document. If you find one, I would like to know where it is located as the man on the phone couldn't tell me either.
Amber
Oops - there are some typos in there, and I also wanted to mention that we do include FMV if there is any with the follwing phrase:
The Orange County Performing Arts Center estimates the value of x membership services and events at $x per year.
The IRS website is a hot mess, for sure. If you piece together snippets of various items than things begin to make some sense, though.
This crazy brochure (http://www.irs.gov/pub/irs-pdf/p1771.pdf) attempts to summarize the gifts and acknowlegdement process. It states on page 3 (5th page of actual pdf) that an acknowledgement from a charitable organization should contain the "description (but not the value) of non-cash contribution".
Publication 561 (http://www.irs.gov/pub/irs-pdf/p561.pdf) defines donated property and how a donor should calculate the value of such items. This includes stocks and bonds.
So, A + B = don't include the fair market value for non cash items including stock on the acknowledgement, but do feel free to include the details that the donor will need to establish the value of the gift for their convenience.
If you would like to take it all step further, you can check out the instructions for form 8283, which is the form a donor would fill out to declare non cash contributions. But that might be a bit too much information (http://www.irs.gov/pub/irs-pdf/i8283.pdf).