RE: Entering gifts on another constituents record (not soft credit related)

Hi Patra-


For question 1, I think we need a few more details about the transaction. You mentioned it's not a pass-through gift which leaves a lot up to interpretation. If, for example, the gift was from a DAF, we would hard credit the donor that directed the funds to us, but the receipt amount would be $0. The donor would get an acknowledgement letter thanking them for the gift, but that letter would clearly state the gift came from DAF XYZ and there's no receipt language on the letter. We don't bother with soft credits anymore. We capture the name on the check in a gift attribute so we know who the legal donor was and can reconcile with our business office. I can't see a good reason to soft credit Fidelity.


For question 2, if your wives have non-constituent records on the husband's record, there is no soft credit to distribute. You can only give soft credit to full-constituent records. I think it's your call on how to apply the gift. If you have a female spouse that you know does not want her male partner to get credit, you're going to need two full-constituent records. At our school, all of our parents give as couples so we use one record for couples and we mention both people on the receipt. Determine what you think is most appropriate for your donor base.


Of course there's a strict legal answer to this question if you are an accountant and subject to financial audits. Luckily, that's not our department.

You're heading down the right path.

So what I think I hear you saying is that we don't have to adhere to strict legal guidelines in RE [AR: Correct] as long as we document what individual/organization/DAF/etc actually receives the tax information [AR: Correct] and do not give credit to the individual donor we want to keep the relationship with [AR: I WOULD give hard credit to the individual donor that directed the gift if you are recording the Name on Check for the legal donor with the receipt amount of $0].


To be clear, you can put that gift on any record you'd like, you just have to be sure to record the correct receipt amount and issue a receipt in accordance with IRS Pulications 526 and 1771. If that endowment was created as part of a family foundation, I would still hard credit that gift under the foundation record with a non-constituent relationship to the donor. Reason being if you want to count your gifts according to CASE standards, that gift should be reported under foundation giving. But ultimately, as long as you can reconcile with your business office and the business office practices are sanctioned by the auditors, you can do whatever you'd like. You're only job is to make sure the receipt you issue is legal per IRS.


I go into a bit more detail on how we handle gifts like this in another thread. Click back to page 1 of that thread and scroll up a bit to find my post.

IF you need to send an annual tax letter to that organization in January, I think you're going to find it difficult to report on these gifts if they are going to be only soft-credits.  I would definitely in this case hard credit the foundation, and put a soft credit for the individual.


This seems like a lot of changes that will really throw a wrench in your reporting.  What is the end goal of these changes?  Is the board not able to see the a person's recognition credit? Putting the gift on another record that won't get the tax receipt seems...questionable.  I think this is where having the individual listed as the primary contact for the organization (assuming the foundation is set up with an organization record) seems like a good practice.  They can be set to be listed on the reports that are run for the foundation.


Regardless of what decision you make, you better document these changes that you are making in your policies and procedures somewhere.

Aaron Rothberg:

If you need to send the donating organization a tax receipt in January, the gift hard credit should go to the donating organization with the full receipt amount. The individual that helped make the donation happen can get soft credit (or not, Raiser's Edge soft credits don't have a Soft Credit Type so we've stopped using them) or else have a relationship record on the donating organization record. In the situation I described I'm mostly dealing with DAFs and DAFs typically don't require a receipt which is why this system works. It's sounding more to me like the endowment gift you've received should be hard credited to the endowment organization record. I would find another way to note the donor that helped bring it in.