Gift Card Procedure

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Christie Michals
Christie Michals ✭
Fourth Anniversary Photogenic First Reply
in Blackbaud Raiser's Edge NXT®: General Discussion

Our organization is looking to develop a gift card procedure and I'd like to learn about what others do when they receive gift card donations.

How do you enter the gift card information into Raiser's Edge and also how do you maintain a back up copy for documentation?

We are thinking to document each unique gift card serial number in RE and also to make a photo copy of all gift cards received. This process seems tedious, but necessary for proper documentation. What do others do?

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  • Austen Brown
    Austen Brown ✭✭✭✭✭
    Ninth Anniversary Facilitator 4 Name Dropper Photogenic

    My org records gifts cards in the system as GIK, but I could see using the gift type ‘other’ as an option in this scenario. In terms of documentation, we fill out a GIK form with the information, including the value that donor reported is on the card. Finance then keeps track of the cards - what they are used for and the current balances.

  • Jess Moxsky
    Jess Moxsky ✭
    Third Anniversary Facilitator 2 Name Dropper Photogenic

    The only reason I would potentially avoid using GIK here is because the GIK record has a “value” field but not an “amount” field. I may just be nitpicky, but I understand “value” to be an approximation, where “amount” is the actual amount of the gift. Since Other gifts are basically a clone of Cash type gifts, Other gifts would still have the “amount" field.

  • JoAnn Strommen
    JoAnn Strommen ✭✭✭✭✭
    Ancient Membership Facilitator 4 Name Dropper Photogenic
    Are you soliciting the donation of gift cards purchased by individuals, donated by businesses or both?


    My experience with gift cards is limited but like Austen Brown‍ posted, we used GIK.


    For receipting donor we followed our GIK procedures of stating the item donated but not saying it is worth $XX. Description could say $50 gift card to ABC Books but did not say that was the value for any receipting purpose. The actual value to the donor is not necessarily the same as the face value, especially if the donor is the business. The donation value a business can claim is based on their specific tax/cost basis. (I use card and purchase books with retail value of $50. The books did not cost the store $50. They cannot claim a $50 donation.)


    As our gift cards were part of auction items we did not record card #s or make copies. I can imagine cases where you would want those details.
  • Kimberly Bonasorte
    Kimberly Bonasorte ✭
    Seventh Anniversary First Reply
    Just a thought... use gift type "Cash", payment method "Other" and explain in the "gift reference field".
  • Mary Schultz
    Mary Schultz ✭
    Seventh Anniversary Facilitator 1 Name Dropper Photogenic

    My organization currently records gift cards as Cash gifts with a Pay method of Other. In the Reference field, we list the cards donated (i.e. "four $50.00 Target gift cards), which prints in the donor's acknowledgement letter as written. However, going forward in the new calendar year, we will be switching to recording them as GIK--we got tired of needing to remember to remove gift cards from financial donation totals when reporting on campaign revenue, events, etc.

  • Faith Murray
    Faith Murray ✭
    Ninth Anniversary Facilitator 4 Name Dropper Photogenic

    After a similar question at our org last year, I spent a deal of time looking up the IRA policies for gift cards and found out that situation plays a defining role.

    Per IRS publication 526: “Cash contributions include payments made by cash, check, electronic funds transfer, online payment service, debit card, credit card, payroll deduction, or a transfer of a gift card redeemable for cash.” As a cash contribution, it would be posted as “Cash” with a pay method “Other”.

    While this would seem to settle the issue, the tricky part here is whether a gift card is redeemable for cash. Only in certain states are gift cards required to be redeemable for cash, and then only if under a certain dollar value (usually $10). See this table for if gift cards are redeemable for cash in your state.

    Then there are the different types of gift cards. MoneyCrashers delineates two types: “Cash Cards” (like Visa prepaid cards) which are always redeemable for cash; and “Store Cards”, which may or may not be, depending on your state and the store policy.

    This is likely why you find so many conflicting articles on gift cards: with MoneyCrashers simply listing them as cash gifts across the board, and AZCentral and a number of nonprofits qualifying them as non-cash donations.

    That is why it is probably a good idea to specifically list your gift card policies in your P&P manual. If you count them as Cash Gifts they would be posted as Cash, with a pay method “Other”. If you count them as GIK, you should still document the Fair Market Value (as a gift attribute, perhaps) in case you ever have to switch gears or in case your donor lives in a state with different rules than you.

  • Cameron Alzubi 3
    Cameron Alzubi 3 ✭
    Fifth Anniversary Facilitator 1 Photogenic

    This is a great post.

    The only thing I would add here is if the gift card is coming from the company itself – i.e. a Target gift card from Target – does not follow this same line of policy. Then it's lost income, similar to when a venue ‘donates’ its space free of charge.

    In those cases we record it as an Other because it's not tax-deductible, but allows us to recognize the donor anyway.

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