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  • 1.  Proceeds from an Auction

    Posted 09-27-2022 02:36 PM
    Hello,

    Our org doesn't have much experience with auctions but a company recently approached us that they would like to donate the proceeds from an internal auction they are holding to us. We are not involved in the actual logistics of the auction. What are the implications, if any, of receiving a gift from the proceeds from this auction?

    Relatedly, the company holding the auction wants their employees (the people bidding on the items) to make their donations directly to our organization. Is there an implication of goods and services being provided even though the goods are not coming from us? I am working on encouraging the company to collect the money internally and send to us in bulk.

    Thanks for any recommendations and guidance!
    Annie

    ------------------------------
    Anne Pires
    Associate Director, Investor Relations
    Year Up
    apires@yearup.org
    ------------------------------


  • 2.  RE: Proceeds from an Auction

    Posted 09-27-2022 03:10 PM
    More information is needed.  Including a look at the contract between you.

    It would be better to treat this as a proceeds to benefit event with that organization handling everything - including sending you a single check.  That check would be credited to that organization.

    If they, instead, tell participants to cut checks to you - then you also have to have the FMV of the items they purchased and issue QPQ receipts - even if you were not providing the auction items.

    And you would also have to know for a fact that the FMY was listed or known to the bidders in advance of the auction.

    And the donors would have to be told that if they paid less than FMV, then they would not be getting a deduction.

    I'd stop the current plans before the auction is held, and either you take the whole thing over - or go with the proceeds to benefit option.

    John
    John H. Taylor
    Principal
    John H. Taylor Consulting, LLC
    2604 Sevier St.
    Durham, NC   27705
    919.816.5903 (cell/text)

    Serving the Advancement Community Since 1987




    Original Message


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