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  • 1.  Pledging out money not received for an event that has passed?

    Posted yesterday

    Hi,

    My organization has been pledging out all monies expected for our annual golf tournament that does include a FMV once the event has passed. Is this best practice? If so, do we pledge out the people who did not attend at all? Or just the participants that actually attended the golf tournament? 

    All replies are appreciated!



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    Vanessa Wilson
    Regional One Health Foundation
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  • 2.  RE: Pledging out money not received for an event that has passed?

    Posted yesterday
    I am not certain what you mean by "pledging out." Can you provide an example of what you are doing?

    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




    Original Message


  • 3.  RE: Pledging out money not received for an event that has passed?

    Posted yesterday

    Apologies! When I say "pledging out", our accounting team turns money not received in time for the event (let's say for a golf foursome), that was invoiced by us, into pledges after the event (and has also been recording the fmv within those pledges). 



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    Vanessa Wilson
    Regional One Health Foundation
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    Original Message


  • 4.  RE: Pledging out money not received for an event that has passed?

    Posted yesterday
    Vanessa, that's a reasonable approach for the accounting department. From their perspective, up until the event itself, they would not consider the promise to give as an enforceable pledge. But once the event happened, and the goods/services were delivered by your org, the outstanding money from those supporters who came/golfed is a debt to your org. That's why it gets characterized as a receivable. And since the money is a mix of charitable and noncharitable, capturing it as a pledge, with FMV, makes sense. 

    For participants who "pledged" that they would donate, but did not donate yet, and did not come to the event, the more likely accounting treatment would be to simply not book anything until cash came in. The promises from those donors are seen as not enforceable, and not creating legal debt. They also did not receive any goods or services, so they don't owe anything. Thus, there is nothing to track. If the money comes in, it will be counted then.


    Thank you,
    Isaac Shalev
    Data Strategy Expert
    Sage70, Inc.
    (917) 859-0151
    isaac@sage70.com

    Schedule a 30-minute consultation now:





    Original Message


  • 5.  RE: Pledging out money not received for an event that has passed?

    Posted yesterday

    Thank you!



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    Vanessa Wilson
    Regional One Health Foundation
    ------------------------------

    Original Message


  • 6.  RE: Pledging out money not received for an event that has passed?

    Posted yesterday
    Let me try to restate this with a fictitious example:
    1. John Taylor registers for a golf tournament with a $500 entry fee.
    2. The tournament's fair market value is $350, leaving a net deductible value of $150.
    3. I do not pay before the event, yet I am still allowed to participate.
    4. After the event, my owed registration fee is converted into a pledge.
    If the above is correct, the pledge should be $500, with an indication that the benefits total $350 and the net gift amount is $150. When I mail my $500 payment, you should issue a QPQ receipt reflecting these values.

    If I registered but never paid or attended, I can't see a justification for creating a pledge unless you experienced a "loss" because of my registration without attendance.

    BTW, if the circumstances are the same as the example but the amounts are higher, with benefits valued at $600+, and I never pay anything, you will likely need to issue a 1099 reflecting the value of the benefits I received, and I will have to pay taxes on that amount.

    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





    Original Message


  • 7.  RE: Pledging out money not received for an event that has passed?

    Posted yesterday

    Thank you!



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    Vanessa Wilson
    Regional One Health Foundation
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    Original Message


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