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  • 1.  Winning a donation?

    Posted 04-19-2024 01:43 PM

    I have one of those "Is this a gift?" questions. We have a vendor that each year, for fun, has a NCAA basketball bracket challenge. Only those schools that use their software are allowed to have faculty and staff play for free. They provide the top 5 winners with a $500 scholarship for their students. One of our faculty members won this year and I'm questioning whether this $500 scholarship is a tax-deductible charitable contribution. 

    There is no issue with how the scholarship money will be used as this is solely at the discretion of the school. However, the contest element is triggering an alarm in my head, right or wrong. The other side of my brain though thinks this is no different than applying for a grant; it's just the criteria for how they select grant recipients is based on NCAA bracket luck!

    My thanks to the hive mind!

    Leah



    ------------------------------
    Leah Richards
    St. John Fisher University
    lrichards@sjf.edu
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  • 2.  RE: Winning a donation?

    Posted 04-19-2024 01:49 PM
    I think you should check with your CFO. This certainly does not qualify as a "voluntary" gift as required by IRS Publication 526. But they might feel otherwise.

    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: Winning a donation?

    Posted 04-19-2024 02:21 PM

    Always good to check with Finance.

     

    It's long been my mantra that (as long as they avoid certain prohibited categories), companies can select recipients for their charitable giving pretty much any way they want: orgs in their local community, orgs in a certain charitable sector, orgs that their employees donate to, orgs where their employees volunteer, orgs where their directors are on the board, orgs that their directors pick, orgs whose names are revealed on an Ouija board, applicants whose applications fly the farthest when the applications are all thrown down the stairs, whatever.

     

    I'm not right off seeing any red flags right off about this method of selection....

     

    My US$0.02 worth; the usual disclaimers apply.

     

    Good luck!

    Alan

     

    Alan S. Hejnal (he/him)

    Data Quality Manager

     

    SNAGHTML5cbfa34

     




    Original Message


  • 4.  RE: Winning a donation?

    Posted 04-22-2024 08:40 AM

    Thank you, John and Alan. I appreciate the advice, and the humor! Alan, I'm now trying to think of when I can try out that "which flies the farthest down the stairs" method. :)

    We'll see where my Finance colleagues land on this one.

    Best regards,
    Leah



    ------------------------------
    Leah Richards
    St. John Fisher University
    lrichards@sjf.edu
    ------------------------------

    Original Message


  • 5.  RE: Winning a donation?

    Posted 04-25-2024 01:25 PM
    If this is informal in nature, then I would view the prizes as a non-binding intent to give, not an obligation of the sort that might turn this into a non-voluntary contribution. If the contest has terms and conditions then I'd need to review those to put forward an opinion. 


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

    Schedule a 30-minute consultation now:





    Original Message


  • 6.  RE: Winning a donation?

    Posted 04-26-2024 08:39 AM

    That makes sense, Isaac. I haven't seen any terms and conditions but after discussing further with our Finance partners, we decided to treat this as an award and not a tax-deductible donation.



    ------------------------------
    Leah Richards
    St. John Fisher University
    lrichards@sjf.edu
    ------------------------------

    Original Message


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