Hi John and Jason,
We just went through this exercise with our Astronomy Center which offers its members 10% discounts on gift shop and restaurant purposes. Although not exactly an “apples-to-apples” situation, we had a similar concern regarding how to quantify the value of the benefit to the donor when some donors may make many gift shop/restaurant purchases and others may not make any?
We spoke with one of the partners of our professional accounting firm to get an answer. Essentially, she said there are two ways you can go about this. One is hard, the other is easy. The hard way is to try to have the membership office provide you with an average of how much benefit members are using (by reviewing their yearly purchases) and then use that. The easy way is to simply state the benefit in the form of the percentage (as promulgated by the center) on the tax receipt you provide to the members.
She clarified that although the IRS stipulates here
https://www.irs.gov/charities-non-profits/charitable-organizations/charitable-contributions-written-acknowledgments
that written acknowledgements (tax receipts) for charitable contributions should contain a, “Description and good faith estimate of the value of goods or services, if any, that organization provided in return for the contribution…”, she advised that the phrase “estimate of the value” need not be interpreted as a quantifiable amount in circumstances where it is impracticable to do so.
Therefore, since our Astronomy Center offers a 10% discount on purchases at their gift shop and restaurant, it should satisfy due diligence on our part simply to state this on each tax receipt to the donor. The expectation being that the donor or their tax preparer then has enough information (assuming the member saves their gift shop/restaurant purchase receipts) by which to determine how much, if any, remaining amount from the membership cost would be eligible to deduct as a charitable contribution.
Hope this helps,
Eric
Eric F. Valdescaro
AVP, Advancement Services
University of Hawaii Foundation
From: Advancement Services Discussion List [mailto:
FUNDSVCS@LISTSERV.FUNDSVCS.ORG] On Behalf Of John Taylor
Sent: Monday, January 14, 2019 10:20 AM
To:
FUNDSVCS@LISTSERV.FUNDSVCS.ORG
Subject: Re: [FUNDSVCS] Golf course membership program
Gotcha.
So when I contacted the IRS on something similar a number of years ago they stated simply that you need to "guess" as to the FMV of the estimated average value per member.
Based on what you have shared with us, I have a hard time seeing any tax-deductible portion at the $250 level. As a golfer, those 6 free lesson will easily exceed that amount.
John
John H. Taylor
Principal, John H. Taylor Consulting
2604 Sevier St.
Durham, NC 27705
johntaylorconsulting@gmail.com<mailto:
johntaylorconsulting@gmail.com>
919.816.5903 (cell/text)
Serving the Advancement Community Since 1987
On Mon, Jan 14, 2019 at 3:09 PM Jason Burdette <
burdette@uga.edu<mailto:
burdette@uga.edu>> wrote:
I imagined this is more like a sponsorship. These members will be “Friends of the Golf Course” who will receive name/logo recognition in addition to the benefits below. Anyone could pay to play without being a Friend.
From: Advancement Services Discussion List <
FUNDSVCS@LISTSERV.FUNDSVCS.ORG<mailto:
FUNDSVCS@LISTSERV.FUNDSVCS.ORG>> On Behalf Of John Taylor
Sent: Monday, January 14, 2019 2:44 PM
To:
FUNDSVCS@LISTSERV.FUNDSVCS.ORG<mailto:
FUNDSVCS@LISTSERV.FUNDSVCS.ORG>
Subject: Re: [FUNDSVCS] Golf course membership program
If these are the required fees to join the golf course then there isn't any gift! It's the cost of joining!
Or am I missing something?
John
John H. Taylor
Principal, John H. Taylor Consulting
2604 Sevier St.
Durham, NC 27705
johntaylorconsulting@gmail.com<mailto:
johntaylorconsulting@gmail.com>
919.816.5903 (cell/text)
Serving the Advancement Community Since 1987
On Mon, Jan 14, 2019 at 2:41 PM Jason Burdette <
burdette@uga.edu<mailto:
burdette@uga.edu>> wrote:
Good afternoon,
Our golf course is creating a membership program with several levels that will include varying degrees of the benefits below. Memberships will start at $250. Seeing as how this is greater than the $75 max mentioned in 526, I assume we should handle as QPQ. Does anyone have experience/recommendations on how to value frequently-available benefits?
* Complimentary cart fees for a year
* “Friends” level pricing on Pro Shop items (10% - 20% discount)
* “Friends” level range fees for a year (10% - 20% discount)
These benefits will also be offered but easier to value.
* (6) Free 45-minute lessons
* Commemorative members’ bag tag
* Invitation to play in “Friends of the Golf Course” tournament
It will be simple to accommodate a donor who chooses to give up all of the benefits given in exchange for their payment, but I am concerned about customizing memberships based on the perks desired by a specific member. That will lead to confused gift processors and frustrated donors.
Thank you,
Jason
Jason R. Burdette
Gift Accounting
UGA Foundation | 394 S Milledge Ave | Athens, GA 30602
706-542-8160<tel:7065428160> |
burdette@uga.edu<mailto:
burdette@uga.edu> | dar.uga.edu<http://dar.uga.edu/>
[University of Georgia]
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