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Receipting for a "Throuple"

  • 1.  Receipting for a "Throuple"

    Posted 07-31-2024 09:23 AM

    Hello!

    We have a couple who have requested that all mailings be addressed to both themselves and a third party(an individual), including gift receipts.

    Is this even legal?

    Thanks for any insight you can provide!



    ------------------------------
    Diane Kucera
    Director, Records and Gift Administration
    Southern Methodist University
    dkucera@smu.edu
    ------------------------------


  • 2.  RE: Receipting for a "Throuple"

    Posted 07-31-2024 09:43 AM
    Receipts must be in the legal donor's name. While uncommon, some donors ask to have copies sent to their CPA or POA.

    I do not know the circumstances of this couple. It seems unusual that "everybody" needs copies rather than one person being the recipient of "In Care Of" mail. However, if you can manage this request and ensure that this "third party" is clearly referenced as "In Care Of," and there is no remote suggestion they are the legal donor, go for it.

    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


  • 3.  RE: Receipting for a "Throuple"

    Posted 07-31-2024 12:04 PM

    Well, we still plan on sending a single receipt, but they want all 3 names referenced. And they want this for both the receipt and the acknowledgement.

    For couples we include both names not knowing if they'll file as a couple or individually so I guess we are already, sort of, doing this, right?



    ------------------------------
    Diane Kucera
    Director, Records and Gift Administration
    Southern Methodist University
    dkucera@smu.edu
    ------------------------------

    Original Message


  • 4.  RE: Receipting for a "Throuple"

    Posted 07-31-2024 12:14 PM
    It's fine to put both legal partners on a receipt. But you cannot add a third party unless, I guess, they are a minor child or the couple are trustees for the individual. However, in that instance, their names would have to reflect their trustee status:

    Bob Smith
    John & Sue Smith, TTEE

    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


  • 5.  RE: Receipting for a "Throuple"

    Posted 07-31-2024 02:15 PM

    Thank you all! I was leaning towards having the gift officer reach out (again). THANK YOU AGAIN!



    ------------------------------
    Diane Kucera
    Director, Records and Gift Administration
    Southern Methodist University
    dkucera@smu.edu
    ------------------------------

    Original Message


  • 6.  RE: Receipting for a "Throuple"

    Posted 07-31-2024 12:44 PM
    There are certainly some gray areas regarding receipting married couples. For example, even if the name on the check is from one spouse, many organizations include both spouses on the receipt. There are too many variables for the nonprofit to deal with - is the state a communal property state? Is the bank account or the credit card jointly held, irrespective of the name on the check? Will the couple file jointly? The IRS doesn't require us to parse through all of this. However, that is still distinct from receipting a group of three people who are not all married. 

    What you can do is what you would do if all three names were on a check: issue three receipts for 1/3 of the total each, or perhaps, a single receipt with the credit divided up three ways.

    But perhaps the best idea is for a gift officer to reach out and to gently discuss the issue and come to an amicable resolution. 

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

    Schedule a 30-minute consultation now:





    Original Message


  • 7.  RE: Receipting for a "Throuple"

    Posted 07-31-2024 04:01 PM

    This may be a naïve question, but IRS publication 1771 (I just double checked to make sure I was not missing something) does not actually require us to include the donor's name in the receipt or acknowledgement.

     

    So then, why does it matter if they're a married couple, a throuple or unmarried joint checking accounr holders etc etc?  

     

     

     




    Original Message


  • 8.  RE: Receipting for a "Throuple"

    Posted 07-31-2024 04:48 PM
    You are only looking at what information the receipt must contain. Not who the receipt is for. The donor!

    Issuing a receipt in the name of a non-donor equals creating a fraudulent tax document.

    Please refer to IRS Publication 526 and the Final Substantiation Regulations issued in 1996. And there is plenty of case law on the subject, too!

    John

    John H. Taylor
    919.816.5903 (Cell/Text)

    Big Ideas; Small Keyboard



    Original Message


  • 9.  RE: Receipting for a "Throuple"

    Posted 08-01-2024 07:31 AM

    Thanks John – made my head spin that the donor's actual name is listed there! 

     

    Although begs the question, when I take my donations to Goodwill, I get a receipt without my name on it – how are they compliant?

     

     




    Original Message


  • 10.  RE: Receipting for a "Throuple"

    Posted 08-01-2024 09:09 AM
    You are supposed to fill that form out there. At our local drop off they ask for a copy.
    John H. Taylor
    919.816.5903 (Cell/Text)

    Big Ideas; Small Keyboard



    Original Message


  • 11.  RE: Receipting for a "Throuple"

    Posted 08-01-2024 09:21 AM
    Goodwill's receipting could be compliant, as John describes. But my experience is that they hand you a blank receipt to fill out as you wish. That's... less compliant.


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

    Schedule a 30-minute consultation now:





    Original Message


  • 12.  RE: Receipting for a "Throuple"

    Posted 07-31-2024 09:44 AM
    The tax receipt can only specify the legal donor - whoever's money it is. But you can certainly send an additional acknowledgement, without tax language, that includes all three people.


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

    Schedule a 30-minute consultation now:




    Original Message


  • 13.  RE: Receipting for a "Throuple"

    Posted 07-31-2024 02:16 PM
    Diane - 

    Interesting situation and my guess here is your reference to a 'throuple' is indication of the three in question here wanting a polyamorous relationship to be recognized in whole as making this contribution. I've read through the other replies but figured it couldn't hurt to weigh in on this.

    Based on some quick searches, it seems there are no specific statutes outlawing participation in a polyamorous relationship in most areas around the US. But there are only a handful of states which have actively indicated recognition of such relationships. To date, however, all I can find is that legal recognition of marriage is still only for two people and polygamy is still illegal. 

    You might want to run this past your general counsel, but at the end of the day it may come down to a staffer (not envying those shoes) having to chat with the primary donor of the gift. Official tax receipts are different from acknowledgement letters where the former requires adherence to IRS regulations and the latter is completely up to SMU's practices and policies.  I don't know how SMU determines who you recognize as the legal donor, but presumably - even apart from the stewardship practice of reflecting two spouse names as addressees on a receipt or ack letter - you have your processes for recording gifts on a single entity record. There are still instances of split gifts, of course, but typically the portion of the gift to be recognized from each participating party is recorded and receipted as such. 

    Good luck and best regards - Amy



    Original Message


  • 14.  RE: Receipting for a "Throuple"

    Posted 08-01-2024 06:33 AM

    I really appreciate all the help with this! We are not going to be issuing a receipt to all 3 parties and have asked the Director of Development talk to them about this.

    Thank you again!



    ------------------------------
    Diane Kucera
    Director, Records and Gift Administration
    Southern Methodist University
    dkucera@smu.edu
    ------------------------------

    Original Message


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