A Gift is a Gift…Or is It? Proper Acknowledgement of Gifts in Kind | npENGAGE

A Gift is a Gift…Or is It? Proper Acknowledgement of Gifts in Kind

By on Dec 7, 2010

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With the holidays upon us most fundraisers are immersed in the business of recognizing the fruits of their efforts—otherwise known as gift acknowledgements.  All of us understand the importance—and need—for timely and accurate “thank yous”, but what happens when we don’t know the best–or right– way to express our appreciation?  This issue has many aspects, some legal in nature, and some stewardship related.  The right answer is dependent upon exactly what type of gift you are trying to acknowledge, but one of the most frequently asked questions involves the best way to recognize gifts-in- kind.

While donors may not always know this—or, perhaps more accurately, appreciate it–non profits are prohibited by law from assigning a “dollar value” to a gift in kind.  I am sure we have all had the experience of the well-intentioned donor who calls, indicating that that beautiful piece of furniture from Aunt Irma’s sitting room is worth $2000—and would we be so kind as to provide a letter acknowledging a gift of this value?  Truth be told, it is the donor’s responsibility to acquire an accurate appraisal of the “fair market value” of a gift (should they desire one).  All the organization is obliged to—and should—acknowledge is simply the receipt of said gift, with an detailed description if so desired.

That said, do not make the mistake of omitting or understating the implied value of the gift.  To the donor, the fact that they may have just parted with a family heirloom item demands a suitable expression of appreciation.  And, there is nothing wrong with indicating what the item may have cost (and therefore diverted in funding to other programs) had your organization gone out and purchased it.  Tony Podaris, in his Potpourri Library, suggests the following wording:

“Thank you for your generous gift of ________(Full Description)________ which we received on ____(Date)____. Your generous contribution will help to further the important work of our organization.

While, according to IRS regulations, you will not be allowed to declare the value of your donation from our acknowledgment, we can say that, but for your generosity, we likely would have had to expend approximately $________ for what you gave as an In-Kind contribution. These are dollars saved which we are able to apply directly to support the programs and services we provide for the well-being of those whom we serve in our community.”

In addition, don’t overlook opportunities to publicly recognize the gift—even in the category representing  the “retail” value—in annual reports and other published recognition vehicles (unless the donor requests anonymity, of course.)  An asterisk can effectively “footnote” the in-kind nature of the gift, or, if there are several, you may elect to create an in-kind category in your report.  Again, depending on the sentimental value of the item, this can provide a lasting tribute to a deceased loved one.  Just as you should always be finding excuses to be inclusive rather than exclusive in your recognition efforts, acknowledging gifts-in-kind in this manner can pay dividends in the long run—even if you haven’t quite figured out what you will do with that priceless heirloom!

ABOUT THE AUTHOR

Laura Worcester, senior consultant at Target Analytics, joined Blackbaud in 2001.In her current role she advises nonprofits on utilizing screening results in identifying and evaluating best donor prospects. In 25+ years of fundraising experience, Laura has served as the chief advancement officer for numerous organizations and managed her own consulting business, providing grant writing services to arts, educational and health care organizations. She’s presented at development conferences and has been a regular contributor to Blackbaud’s blogs with selected posts being reprinted in journals such the NonProfit Times. A traveler since her study abroad days in Denmark, Laura’s committed to passing this enthusiasm on to her teenage daughters. Her family’s travel adventures were just featured in a neighborhood magazine in her suburban Milwaukee community. Contact Laura by email.

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