Home > Donate >> TAX DEDUCTION AND IRS REGULATIONS

 

 



Tax Letters
All donors who make a contribution to the Arts & Heritage Fund will receive a year-end tax letter. Please note, the tax letter will reflect the dollar amount that has been received as of December 31, 2011.

 

For example, if a donor pledges an annual gift of $360 through payroll deduction and the deduction of $30/month begins in April, the tax letter will reflect a contribution of $270, nine months (April to December) worth of $30 contributions.  The remaining $90 of his/her gift will be included in the following year's tax letter.

 

Donors who contribute less than $250 annually may still claim a tax deduction for their contributions, but they must retain a copy of their pledge form and, if they contributed via payroll deduction, their year end paycheck stub to document the amount they are eligible to claim on their tax return for that year.

 

Tax Deduction
Contributions to the Arts & Heritage Fund are fully tax deductible only when no goods or services are received in exchange for the donation.

 

If you plan to offer incentives to employees for their participation in the campaign, we suggest that you make them available to any employee who returns the pledge form to you – regardless of whether he/she makes a pledge or contributes to the Arts & Heritage Fund Campaign.

 

Similarly, you may incentivize attendance at your Campaign events.  If employees attend a performance, informance, etc. they may be entered into a drawing for xx.  As long as what they win is not directly tied to making a pledge or contribution to the campaign, their gifts will be fully tax deductible.

 

If you sell "tickets" for campaign events to raise money for the Arts & Heritage Fund, the amount of money collected for the ticket sales should be reported to us as special event revenue and the individual donors will not be able to include the ticket purchase price in the amount of their contribution for the purpose of claiming a tax deduction.

 

Token Exception for Goods and Services
Some "insubstantial" goods or services may be provided during the course of a fundraising campaign in exchange for contributions that do not have to be described in any tax deduction acknowledgment letter. Examples of this would include small items or benefits that are under 2% of the donation level and low-cost promotional items (under $9 each) with an organization's logo given to donors who contribute more than $45.50. Click here for full details on this IRS rule (PDF).