How to credit gifts from donor-advised fund, check cut by bank

Joanne Danganan:
Hi there, Could you share with me what your organization's business rule is about donor-advised funds that cut their donations via their bank? For example, Joe Smith Memorial Fund Trust was advised by Joe Smith to donate to your organization. The check is written by Joe Smith Memorial Fund's bank, Bank of America. Who is hard credited in this situation? Bank of America or the Fund? In any case, I would soft credit Joe Smith's individual record. Thanks in advance, Joanne Danganan Coordinator, Development and Special Events Dr. Susan Love Research Foundation

Jeanne Zearfoss:

We just received a check from Fidelity Charitable Gift Fund. The funds were from one of our donor's fund at Fidelity.  The donor had an outstanding campaign pledge.  I paid off the donor's pledge with this check and soft credited Fidelity Charitable.  I sent an acknowledge letter to the donor to thank them, even though they had already received a tax deduction when they made the gift to Fidelity Charitable.

You can't pay a pledge from a donor advised fund.  

We would hard credit to Fidelity who issued the check, soft credit the donor and in attributes add the DAF name or whatever fund name they provided. We simply thank the donor since they we receipted by Fidelity.

Coral Henthorne:

You can't pay a pledge from a donor advised fund.  

We would hard credit to Fidelity who issued the check, soft credit the donor and in attributes add the DAF name or whatever fund name they provided. We simply thank the donor since they we receipted by Fidelity.

Our policy is the same as what Carol said.

Since donors are frequently unaware of the laws about paying for pledges through their DAF, we deal with the pledge payment issue often. If I'm pretty sure the payment will be coming through a DAF, I no longer enter the pledge as a gift. Instead I enter an attribute of "Verbal Pledge" with the $$ in the description and the Appeal/Fund in the comments. Then, when the gift comes in, I delete the attribute. This means when I'm looking for unpaid pledges I need to run two reports - one regular gift one and one based on the "Verbal Pledge" attribute.

Of course, there are still times that someone pledges and pays through their DAF. In that case we enter the gift as a regular cash gift, then write off the pledge. If their pledge was for something that was not fully tax deductible (eg. auction item, event ticket), then we contact the donor and let them know that we cannot accept the DAF check as payment for the auction item, etc. It is then up to the donor to either send an additional check covering the "benefit" portion of their gift, or to cancel the DAF check and send in a personal check for the full amount.