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Offering incentives for fundraising - yes or no?

  • 1.  Offering incentives for fundraising - yes or no?

    Posted 02-20-2024 03:23 PM

    At what point does it become a "raffle" item if you offer concert tickets, dinner with the university president, a lulu lemon bag, etc to entice donors to participate in a fundraising activity (i.e. Day of Giving or Giving Tuesday, etc)...asking for a friend ;)



    ------------------------------
    Jana Hunt
    Gannon University
    hunt001@gannon.edu
    ------------------------------


  • 2.  RE: Offering incentives for fundraising - yes or no?

    Posted 02-20-2024 03:30 PM
    All of the above. Any payment that earns you a chance to win anything is a game of chance and nullifies the deductibility of any portion of the payment.

    See pages 3 & 7 of IRS Publication 526.

    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: Offering incentives for fundraising - yes or no?

    Posted 02-21-2024 11:17 AM

    The language being used is important, I think.  "Raffle" is a specific sort of activity, with specific requirements.

     

    Offering a chance to win an item (as opposed to offering an item directly in consideration of a gift, which is a garden variety quid pro quo) may cross into raffle territory and negate a gift.

     

    Of course, if the chance to win is not limited to donors (typically by offering an alternate way to enter that does not require a gift, which public broadcasting stations do quite adeptly, for instance), there may not be any impact on deductibility at all.

    If the activity is structured/promoted as buying tickets to win a valuable prize, that would almost certainly fall into the raffle category, and negate any charitable component.

     

    The details are important!

     

    My US$0.02 worth; the usual disclaimers apply.

     

    Good luck!

    Alan

     

    Alan S. Hejnal (he/him)

    Data Quality Manager

     

    SNAGHTML5cbfa34

     






  • 4.  RE: Offering incentives for fundraising - yes or no?

    Posted 09-10-2024 04:08 PM

    hello,

    I'm looking to briefly resurrect this topic with a long story.

    Annual Giving is looking to engage with alumni to make a donation for their milestone reunion.

    I was asked "Can we do a raffle at the Grand Reunion for anyone that gave to their class gift?"

    I provided the statement from IRS Pub 526 to say that it would not be a tax-deductible donation.

    Then I was asked, "What if the "raffle" is more of a "swag giveaway" where there's no cost associated with a raffle ticket? More like, everyone who donates gets their name put in a hat and someone wins alumni swag?"

    I still feel like this is a raffle and the only way "around" this is to make it available for anyone to be entered into a "drawing" and provide a simple way for people to enter without making a donation.

    I need confirmation or feedback from my Adv Serv folks. 

    Thanks much, Lara



    ------------------------------
    Lara Couture
    Carroll University
    lcouture@carrollu.edu
    ------------------------------



  • 5.  RE: Offering incentives for fundraising - yes or no?

    Posted 09-10-2024 04:20 PM
    Laura - I don't envy you having to revisit this topic over and over again. As far as I'm aware, the value of the prize isn't material to the issue. Bottom line, if this game isn't open to everyone - even if they did not make a gift - then having a raffle associated with the "gift" transaction turns it into a ticket rather than a charitable gift... 

    Best regards - Amy





  • 6.  RE: Offering incentives for fundraising - yes or no?

    Posted 09-10-2024 04:52 PM

    Man! I appreciate you all. Thanks, John and Amy for such a quick response and confirming my thoughts on this matter.

     

    Have a great week, everyone!

     

    Lara Couture

    Director of Advancement Services

     

    Office:  262-951-3101

    carrollu.edu

     

    Logo

     

    100 East Avenue | Waukesha, WI 53186

     

    The Carroll Fund: Every Person. Every Gift. Every Story.

     






  • 7.  RE: Offering incentives for fundraising - yes or no?

    Posted 09-10-2024 04:22 PM
    It is still a game of chance. State gaming rules apply.

    The only way to avoid those challenges is to permit anyone to enter without making a gift.

    John H. Taylor
    919.816.5903 (Cell/Text)

    Big Ideas; Small Keyboard





  • 8.  RE: Offering incentives for fundraising - yes or no?

    Posted 04-09-2025 10:41 AM

    Bringing this up again as I have been asked if "Alums who share the Giving Day page or make a gift" could be eligible for a prize. Would that avoid the "raffle" designation?



    ------------------------------
    Dan Snyder
    Bennington College
    dsnyder@bennington.edu
    ------------------------------



  • 9.  RE: Offering incentives for fundraising - yes or no?

    Posted 04-09-2025 11:04 AM
    Dan, to be safe you really need to state, "No gift or pledge is required to enter." I do not see how you can effectively monitor who is sharing what.

    And with that quoted statement you must make it incredibly easy to enter.

    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







  • 10.  RE: Offering incentives for fundraising - yes or no?

    Posted 04-09-2025 12:12 PM
    Thanks John. We do have tracking of who shares via GiveCampus, but you are right that can be difficult to track.

    --
    Dan Snyder (he/him)
    Director of Advancement Services 
    Office of Institutional Advancement 

    Bennington College 

    One College Drive 
    Bennington, VT 05201 
    Mobile: +1 (585) 307-1747

    To make a secure online gift click hereOr, for more information on ways to make a gift, including stock transfer instructions, please visit our website.





  • 11.  RE: Offering incentives for fundraising - yes or no?

    Posted 04-09-2025 12:25 PM
    After I sent the note, I then wondered how useful sharing the website with my 13-year-old would be :-).

    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







  • 12.  RE: Offering incentives for fundraising - yes or no?

    Posted 04-09-2025 06:13 PM
    Dan,

    We use RNL's ScaleFunder for our Giving Day and their Champion features allows for tracking within their system the number of shares and other fundraising effort stats.

    Thanks,
    Amber
    _______________________________________________

    AMBER R. GICHARD

    Senior Director of Fund & Gift Services

    University of Alaska Foundation

    1815 Bragaw St., Suite 206, Anchorage, AK 99508

    Direct: 907.786-1016

    Make a gift online: engage.alaska.edu 

    See the impact of the For Alaska campaign: universityforalaska.com


    UA Employees: Please request donor/gift reports, and lists through the Foundation's Information Request Google Form(To access this form, you need to be logged into your UA Google account.)