This quiz will test a person's knowledge on recording various types of donations.

Please review the IRS instructions for the IRS Form 1098-C to see who must file.

The IRS Form 1098-C is what you use to for a qualified vehicle over 500.00.

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.

According to the IRS website there the information that must be on the statement is as follows. Keep in mind there are different types of donations but this questions did not look at non cash donations.
Name of the organization;

• Amount of cash contribution;
• Description (but not value) of non-cash contribution;
• Statement that no goods or services were provided by the organization, if that is the case;
• Description and good faith estimate of the value of goods or services, if any, that organization provided in return for the contribution; and
• Statement that goods or services, if any, that the organization provided in return for the contribution consisted entirely of intangible religious benefits, if that was the case.

A volunteer can't deduct their time and services. However an attorney can ask for a GIK donation statement for things like travel expenses for the attorney to come and meet with your organization. Or say for all the cost of mailings to your organization. In other words the expenses have to be documented and not just a 'service' or 'time'. There are a lot of rules on this that the churches should review before giving out any donation statements to any volunteers.

According to the IRS website, non cash donations are not to have their value placed on the statement. Another resource is:

IRS Publication 561.

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.

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.

1. “No goods or services were provided by the church in return for the contribution.” Or
2. “Goods or services that the church provided in return for the contribution consisted entirely of intangible religious benefits.” Or
3. “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.”

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.