Magnifying GlassGet a free trial of IconCMO now! 30 days – No credit card required. Donation Quiz To start the quiz, click the blue ‘Start’ button below. 64 Created on December 30, 2020 Donation Recording Quiz This quiz will test a person's knowledge on recording various types of donations. Your results are for personal use and only available to you. 1 / 10 Category: General Questions Question:Which of the following statements is not used on a donor's statement? No goods or services were provided by the church in return for the contribution. The amount of the contribution that is deductible for federal income tax purposes is limited to the excess of money (and the fair market value of any property other than money) contributed by the donor over the value of goods or services provided by the church. Goods or services that the church provided in return for the contribution consisted entirely of intangible religious benefits. Only goods or services were provided by the church in return for the contribution. There are three different statements that the church can used depending on the circumstances of the donations. When these statements are not made the IRS can disallow the donation. See the court case in 2012 that dealt with this issue -- David and Veronda Durden v. Comm’r, TC Memo 2012-140 May 17, 2012.“No goods or services were provided by the church in return for the contribution.” Or“Goods or services that the church provided in return for the contribution consisted entirely of intangible religious benefits.” Or“The amount of the contribution that is deductible for federal income tax purposes is limited to the excess ofmoney (and the fair market value of any property other than money) contributed by the donor over the value of goods or services provided by the church.” 2 / 10 Category: GIK - Or Non-cash donations Question:When a donor donates stock to the church, which they held for more than a year, what tax benefit does the donor receive? The donor does not pay state income tax. The donor does not pay the capital gains tax. The donor does not pay the stock income tax. The donor does not pay ordinary federal income tax. When stocks are donated directly to the church instead of cash, the donor does not pay any 'capital gains tax' on the stocks. If the stocks appreciated a lot and the donor is in a top tax bracket, this translates to a 37% tax savings as of tax year 2020. And all the stock appreciation goes to the church. Avoiding the capital gains tax only works on stocks that are owned for at least one year. Keep in mind the more the church can advise donors on their giving options and how they benefit the donor the more the church could receive in donations. 3 / 10 Category: General Questions Question:On a donor's statement, does each donation need a date next to it? See the example below.01/15/2022 $50.0001/30/2022 $25.00 No Yes According to IRS publication 1771 page 4, under the Recordkeeping Rules, subsection 'Requirement', the date and amount are both needed. While the IRS publication 1771 says the donor is responsible for this information, the church should have it on the donor statement so they can match it their records such as a bank record like a cancelled check or bank statement. 4 / 10 Category: General Questions Question:The donor's total donations for the year are $550.50, does the church have to provide a written acknowledgement to the donor? Yes No According to the IRS website donations that equal $250.00 or more need an written acknowledgement. 5 / 10 Category: Vehicle Donations Question:Does the church or donor provide the claimed value of the vehicle, boat, or airplane over $500.00? Church Donor According to the IRS instructions for the 1098-C, the donor must figure out the amount for the donated item (ie car, plane, and boat). This is atypical because most gifts in kind (GIK) can be donated without knowing the value. Most GIK's don't require a 30 day reporting period. According to the IRS website a written acknowledgement is needed for a contribution over $250.00. The exact wording is "A donor claiming a deduction of $250 or more is also required to obtain and keep a contemporaneous written acknowledgment for a charitable contribution ." For a single donation under $250.00 the donor can provide their own records to prove the donation -- ie like bank records, credit card receipts. Or the church can provide the written acknowledgement but they are not mandatory to do so. Keep in mind if there are multiple donations that total to $250.00 or more, then the church must do a written acknowledgement of all the donations and the dates of them. 6 / 10 Category: General Questions Question:Does the church have to provide a written acknowledgement for a single donation under $250.00? Yes No 7 / 10 Category: Vehicle Donations Question:When a vehicle is donated that is claimed to have a value of more than $500.00, what IRS form must the church fill out? IRS Form 8383 IRS form W-3 IRS Form 8282 IRS Form 1098-C Please review the IRS instructions for the IRS Form 1098-C to see who must file. 8 / 10 Category: General Questions Question:When donations are sent via the USPS (United States Postal Service) and not a private mail carrier, what is the latest date the postmark can show to include the donation on the donors statement? January 2nd December 30th January 1st December 31st The IRS's basic rule is that the gift must be delivered to the church by December 31st. For USPS they use the postmarked date as the delivery date, whether or not the donation envelope is physically delivered to the church. 9 / 10 Category: Vehicle Donations Question: Generally speaking, how many days after a vehicle donation greater than $500.00 does the church have to furnish the donor with the IRS form 1098-C? 60 days 30 days January 31st the following year 90 days The IRS instructions for the IRS Form 1098-C states the following: "Generally, the charity must furnish this form to you no later than 30 days after the date it sold the donated vehicle (if box 4a is checked) or 30 days after the date of the contribution (if box 5a or 5b is checked)." 10 / 10 Category: General Questions Question:The donor makes two donations of $260.00. Can the donor claim the deduction using their own bank records? Yes No As stated in the IRS publication 1771, the church must send a written acknowledgement (donor statement) to the donor for any one time contribution over $250.00. 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