Waiving Tuition in Exchange for Professional Services

by Mary
(Texas )

We are a non profit organization 501 c3, religious, catholic private school who receives tuition fees from the enrolled students.

We have a parent that will be providing the school with a professional service of photography and video for free for the school. However, we will be waiving the tuition fees for his children.

How do we handle this type of transaction?

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Sep 25, 2017
It's not a donation
by: Anonymous

Keep it simple and clean as transactions.
1. Have the parent pay for his child's tuition (e.g., $3500).
2. Turn around a cut a check (e.g., for $3500) as payment for services rendered.

No use going through the hoops of trying to put a valuation of a donation of service or having the parent try to claim it as a deduction, because it doesn't qualify as a contribution. It's quid pro quo exchange for goods and services.

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If you want to DIY your payroll, I highly recommend you look at using Gusto! It is very user friendly and their support is awesome! Plus they know how to set up and maintain payrolls for churches and nonprofit organizations.

Note: I am a "partner" of Gusto, but as I have told you before ... I never recommend anything that we or our clients have not tried and love =)

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