Considered to be a charitable contribution?

by Sheila
(Muscle Shoals, AL, )

A member of the church I work at paid $100.00 cash to someone to cut down a tree on the church property. The member wants to count this as a contribution. Is this allowed?

Comments for Considered to be a charitable contribution?

Click here to add your own comments

Dec 03, 2014
 Charitable contribution?
by: Lewis in NC

It would be better for the individual contributing to donate the $100 for the tree cutting to the church and let the church write the check; however, the church can now only acknowledge the $100 in a thank you letter. The letter can serve as the receipt of the monetary gift for the individual.
Dec 03, 2014
 Charitable Contributions
by: MarcusNTexas

Chairs in our church's Fellowship Hall were looking rather ragged and a member asked me if she bought some new chairs would she be able to count that as a charitable contribution. As church treasurer, I advised her to make a contribution to the church designated for the purchase of replacement chairs. I believe that would be considered a "legal" charitable contribution since the chairs were purchased the following week with the funds the church member had provided for that purpose. This seems much better than having her purchase the chairs, donate them to the church and then later on having to deal with the IRS regarding the charitable nature of the donation of chairs to the church. The donation of money for the chairs will appear on her official "giving record" for 2014.
Dec 03, 2014
 contributions
by: Sheila

It would have been much better for the member to pay this person through the church office but of course that isn't the case.

To MarcusNTexas, There are a couple of ways to deal with items purchased. You can enter a non-cash gift from an individual (like for the church chairs) and include a description with no amount. The individual is responsible for keeping up with the receipt for the items purchased. Another ways is like you said, they can make the donation to the church and the church can purchase the chairs but according to the IRS, an individual cannot dictate what money given to the church is used for. The church would have to set up a designated fund for it to be a tax deduction. Of course, the money can be used the way the individual wants it to used as long as there is no problem with any of the church members. This is actually a good thing the IRS has done. It keeps churches from receiving "gifts" that the church really doesn't want to be used the way the donation was dictated.
Dec 03, 2014
 Charitable Contributions
by: MarcusNTexas

In the case of new chairs for the Fellowship Hall, church members wanted to have the chairs replaced, but nothing had been approved in the current year's operating budget for the cost of the chairs, so when a member volunteered to cover those costs, it was agreed that the gift should be accepted and the chairs purchased with the gift funds, so it was unanimously agreed that the chairs were needed and the gift of the funds to purchase the chairs would be enthusiastically accepted.
Dec 04, 2014
 service performed
by: Anonymous

I'm reading this as if he cut down the tree and didn't take the payment?
This should help:
from-
http://www.irs.gov/publications/p17/ch24.html#en_US_2013_publink100034123

Out-of-Pocket Expenses

If you give services to a qualified organization and have unreimbursed out-of-pocket expenses related to those services, the following two rules apply.

You must have adequate records to prove the amount of the expenses.

If any of your unreimbursed out-of-pocket expenses, considered separately, are $250 or more (for example, you pay $250 or more for an airline ticket to attend a convention of a qualified organization as a chosen representative), you must get an acknowledgment from the qualified organization that contains:

A description of the services you provided,

A statement of whether or not the organization provided you any goods or services to reimburse you for the expenses you incurred,

A description and a good faith estimate of the value of any goods or services (other than intangible religious benefits) provided to reimburse you, and

A statement that the only benefit you received was an intangible religious benefit, if that was the case. The acknowledgment does not need to describe or estimate the value of an intangible religious benefit (defined earlier under Acknowledgment ).

You must get the acknowledgment on or before the earlier of:

The date you file your return for the year you make the contribution, or

The due date, including extensions, for filing the return.
Feb 18, 2015
 not a charitable contribution nor out of pocket expense
by: Anonymous

I just happened to come across this page and thought I'd add a comment. Paying for the service to have the tree cut down wouldn't be a charitable contribution since the person didn't give money to the church.

It wouldn't be an out of pocket expense since the person wasn't the one who did the work/spent money to perform the service. That expense is only applicable when he's providing a service to the church and incurs expenses directly related to the service. The part referenced is connected to a section above the page entitled Out-of-Pocket Expenses in Giving Services. There are examples there.

As Sheila mentioned donating chairs to a church is a charitable contribution. See IRS info on Contributions of Property. The church can provide a statement of what was donated and the donor would keep that and the receipt for the chairs. She's also correct about trying to earmark a donation for chairs. Although organizations might return the donation if they receive it that way out of courtesy I don't think they're required to. I think the only time they're required to return a donation or the donor has legal rights is only if they solicited for a particular project and didn't use the funds for it.

Click here to add your own comments

Join in and write your own page! It's easy to do. How? Simply click here to return to Earmarked Contributions.



Need training on how to use QBO or Aplos effectively for a church or better yet ...need an expert in either of those accounting software to do your monthly bookkeeping and/or payroll? See more on our accounting services!

Contact Me!




Recommended Resource!

Online classes/courses on how to use QuickBooks Desktop and QB Online for a church! 

Click here for more details!

Use coupon code "FCA" for 10% discount!