Since the year is almost over, it is a good time to review the rules for issuing charitable contribution statements.
Charitable contributions must be reported/claimed in the year in which they are delivered to the charity. If you receive cash or a check after December 31, it should not be included on the donor’s 2014 contribution statement. This is true even if the check is dated in December but delivered in January.
For the purpose of determining the delivery date, a contribution that is mailed (postmarked) by December 31, 2014 is considered delivered by that date and can be included on the donor’s 2014 contribution statement. However, if you receive a check in 2014 that is dated in January 2015, it must be held until 2015 and recorded as a 2015 contribution.
Not following these rules can jeopardize the tax exempt status of the church.
Each contribution statement should include the following statement: “No goods or services were provided in exchange for your contribution.”
We suggest that you advise your donors to not file their 2014 income tax return until they have received a written acknowledgment of their contributions from the church. Under IRS rules, they may lose the deduction if they file their tax return before receiving the written acknowledgment from the church.
Delano Sherley is a CPA and president of Delano Sherley & Associates, Inc. He can be reached at 513-737-1314. Delano Sherley & Associates, Inc., 3189 Princeton Road, Suite 228, Hamilton, OH 45011. Email: Delano@dsacpainc.com Website: www.dsacpainc.com