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  • 1.  Family Foundation responsibility

    Posted 11-19-2024 02:46 PM
    We recently had a donor attend an event and write a check from their foundation to cover both an outright gift, as well as a golf outing package that was a silent auction item.  When I explained that he can't use the foundation to purchase an item he receives a benefit for, the donor responded that he's aware of that which is why he is going to reimburse the family foundation for the amount of the golf package.

    Must we return the uncashed check to the donor in its entirety, because of the portion that he wanted to be used to pay for the silent auction item?

    Or can we accept this check from the foundation, applying the charitable gift portion and making the payment for the silent auction item, based on the donor's declaration that he's aware of the tax law and that he is going to repay the foundation?

    I guess I'm a little unsure on whom (the non-profit or the donor) the obligation falls.

    Thanks!


  • 2.  RE: Family Foundation responsibility

    Posted 11-19-2024 03:09 PM
    I'd return the funds and request a personal check. But if that doesn't feel appropriate in your case, I'd ask my lawyer what they would suggest.

    John

    John H. Taylor, Principal
    John H. Taylor Consulting, LLC
    2604 Sevier Street
    Durham, NC     27705

    919.816.5903 (cell/text)

    Serving the Advancement Community Since 1987






  • 3.  RE: Family Foundation responsibility

    Posted 11-19-2024 04:42 PM

    While I'm unsure if there's any real risk of wrongdoing on your part, I would return the check, and kindly request a personal check for the silent auction item, and a new check from the family foundation for the donation amount only. I would explain that you trust the donor's intent to reimburse the family foundation, but for audit and tax purposes, and to align with what your knowledge of IRS and tax policies are, you would rather not accept a check from the family foundation for a silent auction purchase. I would imagine the family foundation likely (hopefully) has their own fiscal policies the donor would want to honor, so this approach is the most fiscally responsible and transparent for all parties. 



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    Michele Whitaker
    Baton Rouge Community College Foundation
    [whitakerm@mybrcc.edu]
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