Trustees dues to be match funded by other organisation

Alicia Lozano · January 2019

Hello,

Our Trustees are paying their trustees dues via another organisation, which will then match these donations. How can we record this?

Do we create a pledge on our donors' record and a matching pledge on the matching organisation's record? We've recorded a pledge of the total amount expected on the matching organisation's record but i don't think this is the right way as it will double count the money?

Can anyone help?

Thanks in advance

Dariel Dixon 2 · January 2019

Regardless of how the gift is coded, you would be able to just soft credit half of the payment to the trustee.

I think the answer comes into how the two pledges would be coded. If the matching portion would be coded differently (ie. different appeal or campaign codes), I think it might be better to create the two pledges and have the payment satisfy both. I'm not sure it would matter, since you only have one payment either way.

Tom Klimchak · January 2019

We, unfortunately, have this sort of situation all the time. Entering both a full pledge and matching gift pledge would most likely be double-counting money as you suspected.

We would put the full pledge amount on the Trustee's name and then NOT enter a matching gift at all. When the Organization pays the first half they can be the hard credit donors paying off part of the Trustee pledge. When the matching gift comes in simply apply that payment to the Trustee's pledge as well. In both payment you would do exactly as Dariel says: give soft credit to the Trustee. One pledge, two payments, no double-counting.

Individuals really shouldn't rely on matching gifts to pay off their pledges, but trying to tell that to a Trustee is a hard sell.

This is all assuming that the "dues" are a 100% tax-deductible donation. If the Trustee is receiving something in return for those "dues" then the whole thing becomes much more complex.

Alicia Lozano · January 2019

Thanks for your replies.

It's actually a bit more complex.

We have 4 Trustees paying their annual Trustees dues through that route. So they paid their dues to the organisation directly and then the organisation is sending us the money and matching it.

This is paid to us in two instalments and we just received the first one.

A pledge has been recorded on each Trustee's record with the amount they were expected to pay and then a pledge of the total amount has been recorded on the organisation's record.

Now, if i add a pledge payment on Trustees'records and another one on the organisation's, it will inevitably be a double count so just trying to sort this mess out.

Should we have only one pledge on the organisation's record and then as you suggested it soft credit the right amount to the Trustees (and thus no matching gift)?

(Apologies, I think I just confused myself again)

Dariel Dixon 2 · January 2019

Alicia Lozano:

Thanks for your replies.

It's actually a bit more complex.

We have 4 Trustees paying their annual Trustees dues through that route. So they paid their dues to the organisation directly and then the organisation is sending us the money and matching it.

This is paid to us in two instalments and we just received the first one.

A pledge has been recorded on each Trustee's record with the amount they were expected to pay and then a pledge of the total amount has been recorded on the organisation's record.

Now, if i add a pledge payment on Trustees'records and another one on the organisation's, it will inevitably be a double count so just trying to sort this mess out.

Should we have only one pledge on the organisation's record and then as you suggested it soft credit the right amount to the Trustees (and thus no matching gift)?

(Apologies, I think I just confused myself again)

I don't think you should put a pledge on the trustee's record at all if you are putting the full amount on the organization's record. Either you place the full pledge amount on the org record, or you can split the pledge amount between the trustee and the org. The pledge payment only goes on the organization record. You can use the pay the trustee's pledge using the load pledge from button. I would soft credit the trustee with their portion as well. Having the amounts come in as two separate payments may make it easier as you can pay one whole pledge with one, and the other pledge without having to split the payments in half percentage wise.

But, just so that we're clear, you are receiving twice the amount of the dues, not just both halves making up the dues payment.

Alicia Lozano · January 2019

Dariel Dixon:

I don't think you should put a pledge on the trustee's record at all if you are putting the full amount on the organization's record. Either you place the full pledge amount on the org record, or you can split the pledge amount between the trustee and the org. The pledge payment only goes on the organization record. You can use the pay the trustee's pledge using the load pledge from button. I would soft credit the trustee with their portion as well. Having the amounts come in as two separate payments may make it easier as you can pay one whole pledge with one, and the other pledge without having to split the payments in half percentage wise.

But, just so that we're clear, you are receiving twice the amount of the dues, not just both halves making up the dues payment.

yes, that's right, we are receiving twice the amount of the dues

Ryan Hyde · January 2019

Okay, so this should be an option then:

1.) Enter a pledge on the Trustee's record

2.) When the gift comes in, enter it as TWO gifts, each for half of the total amount

3.) Both gifts go on the org record

4.) One of the gifts is used to pay off the Trustee's pledge (use the Load Pledge From button as previously mentioned)

5.) The one that pays off the trustee pledge should also be soft credited to the trustee

6.) The other gift should just be processed as normal

Alicia Lozano · June 2019

I thought I solved this case but... no, it's getting more and more complex.

I have a pledge on Trust 1 record, which one of the pledge payment should pay off 2 other pledges on another record (Trust 2).

As the payment comes from Trust 1, it should be recorded on Trust 1's record but i can't load the pledges from another record, because then it will only reduce the remaining balance of the other trust and not both.

Can i write off the remaining balance on Trust 2 and make a note that payment has been received through Trust 1 (and soft credit it?)

Does this make any sense? Has anyone ever encountered such a tricky scenario?

Thanks, Alicia

Dariel Dixon 2 · June 2019

If you are completely paying off one pledge with a payment, can't you use the remainder as a cash gift functionality to create two gifts, and use the remainder gift as the other pledge payment. I haven't tested that, but I don't see a reason why it wouldn't work.

But that's a headache for certain.

Alicia Lozano · June 2019

It isn't completely paying off the pledge from Trust 1. We're still expecting other payments to pay off Pledge of Trust 1. But the first payment is paying off two other pledges from another Trust. I can soft credit, but it won't reduce the balance....

Dariel Dixon 2 · June 2019

Alicia Lozano:

It isn't completely paying off the pledge from Trust 1. We're still expecting other payments to pay off Pledge of Trust 1. But the first payment is paying off two other pledges from another Trust. I can soft credit, but it won't reduce the balance....

I understand that, but could you pay off the pledge(s) for Trust 2 first, and then use the remainder as the pledge payment for Trust 1. I think the order that the pledge payments may be ordered is causing the issue, because you don't get the option to split the gifts until the pledge is fulfilled. But fulfilling those other pledges should allow that to happen. You have to make sure you don't automatically attribute the gift to the Trust 1 pledge though.

Alicia Lozano · June 2019

Hi Dariel, thanks for your continuous help with this matter.

I did add the cash remainder to pay off the pledge on Trust 2. However, by doing so, it doesn't reduce the balance of the pledge on Trust 1.

Let's take an example:

Pledge of £1,000,000 on Trust 1.

First pledge payment of £500,000 has been received, of which £200,000 is to pay a pledge for another Trust (Trust 2).

So £300k have been paid against pledge Trust 1 and the £200 cash remainder, by loading a pledge from another record.

The remaining balance on Trust 2 is now down to £0, but the balance on Trust 1 is £700k rather than £500k.

Once we've received the last payment for Trust 1, shall I write off the remaining balance?

Thanks,

Alicia

Dariel Dixon 2 · June 2019

Alicia Lozano:

Hi Dariel, thanks for your continuous help with this matter.

I did add the cash remainder to pay off the pledge on Trust 2. However, by doing so, it doesn't reduce the balance of the pledge on Trust 1.

Let's take an example:

Pledge of £1,000,000 on Trust 1.

First pledge payment of £500,000 has been received, of which £200,000 is to pay a pledge for another Trust (Trust 2).

So £300k have been paid against pledge Trust 1 and the £200 cash remainder, by loading a pledge from another record.

The remaining balance on Trust 2 is now down to £0, but the balance on Trust 1 is £700k rather than £500k.

Once we've received the last payment for Trust 1, shall I write off the remaining balance?

Thanks,

Alicia

Well, taking your example, the balance should only be £700K. The 500 was split 2 ways... 200 to fulfill one pledge, and 300 for the next. A payment can't fulfill more money than it is worth. In order to satisfy the pledge on Trust 2 and get the balance of Trust 1 to £500k, there would have had to have been a payment made of £700k (200 + 500). It works this way to make sure money isn't counted twice.

As far as the write-off, I'm sure you can. But honestly, that money should be coming in. The better question is why wouldn't both pledges be completely satisfied. But before you write it off, consider an adjustment to your pledge, especially if you think you're not going to see the pledge paid off.

Trustees dues to be match funded by other organisation

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