Obviously the donors sent in the checks hoping to have a
The nonprofit I work with received several checks postmarked 12/31 and several checks dated 12/31. What year are you recognizing gifts received 1/2 and 1/3 and possibly 1/4?
Answers
My understanding is that if audited, the IRS will look to the date of the receipt you give the donor and that should correspond to the check date. Obviously, you will want to make sure you don't abuse this by backdating receipts when it is clear that the donor is backdating the check.
The date of Receipt or deposit doesn't seem to matter from my understanding (again unless this is clearly a 2013 event for the donor and you have knowledge of it).
1
Postmark date is the rule. If mailed Dec 31 or prior, then it is a 2012 donation. IRS regs are clear about donor acknowledgements - don't participate in fraud.
For a cash basis organization, in the year of receipt...2013 in this case. Dates on checks are neither governing nor reliable. Different if you received mail but did not open it intil 2013.
I have a related question. Since these are donations received, aren't you required to send a statement to the donors? If you record the donation as received in 2013, are you allowed to provide a donation statement to the donor for 2012?
1
Yes, you should be sending your donors a statement acknowledging the receipt of the donation (required for donations over $250). You cannot show this in your 2013 records and give a letter dated in 2012. There is a nice publication from the IRS (Pub 1771):
http://www.irs.gov/pub/irs-pdf/p1771.pdf
I can't seem to find where the IRS insists on using the envelope postmark for recording donations. Audits I have been through only as for copies of the checks (since the envelope with the postmark are rarely kept).
Mukoko (owner for 501 C 3), Jan 18, 2013
Here is a comprehensive discussion by the Evangelical Council for Financial Accountability®
http://www.ecfa.org/Content/TopicTimingContribution
Here is the IRS Publication 526 for guidance
http://www.irs.gov/pub/irs-pdf/p526.pdf
Intuit's Guidance about deductibility of Charitable Donations
http://turbotax.intuit.com/tax-tools/tax-tips/Tax-Deductions-and-Credits/Charitable-Contributions-You-Think-You-Can-Claim-but-Can-t/INF22344.html
Thank you, Valerie for Pub 526. I have always gone with the post stamp on the envelope. We specifically kept envelopes received through January 15th to make sure all those postmarked on or before 12/31 supported the acknowledgement dated in 2012.
The answers of Richard and Valerie are spot on. Checks must be dated 2012 and postmarked by 12/31/12 to be considered 2012 contributions.
From the receiver's perspective, it would be considered a deposit in transit.
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