Not tax advice. Only gifts to qualifying organizations, such as 501(c)(3) charities, can be deducted as charitable gifts. Gifts to social clubs (501(c)(7)) and most other clubs cannot. Check your club's status before calling any gift tax deductible, and leave the tax lines out of the letter if they do not apply to you.
What the IRS asks for
Single gifts of $250 or more
A donor who wants to deduct a single gift of $250 or more needs a written acknowledgment from the organization. It should include:
- the organization's name
- the amount of a cash gift, or a description (not the value) of a gift of goods
- the date of the gift
- a statement of whether the organization gave anything in return, and if it did, a description and a good faith estimate of its value
The donor needs it by the time they file their tax return for that year. Sending it within a few weeks of the gift, or in a January summary, covers that.
Payments over $75 where the donor got something back
When someone pays more than $75 and receives something in return, such as a dinner ticket or an auction item, the organization must give them a written statement that only the amount above the value of what they received may be deductible, with a good faith estimate of that value. Leaving it out can cost the organization $10 per payment, up to $5,000 per event or mailing.
Letter A. A gift with nothing given in return
Letter A
[Date]
Dear [Donor name],
Thank you for your generous gift of [$ amount] to [Club name], received on [date of gift]. [One sentence on what the gift will help the club do.]
[Club name] is a tax exempt organization under section 501(c)(3) of the Internal Revenue Code. Our EIN is [EIN].
No goods or services were provided in exchange for this contribution.
Please keep this letter for your tax records.
With thanks,
[Your name]
[Your role], [Club name]
[Club mailing address]
Letter B. A payment where the donor received something
Letter B
[Date]
Dear [Donor name],
Thank you for your payment of [$ amount] for [event or item] on [date]. [One sentence of thanks.]
In exchange, you received [what they received, for example dinner for two], with an estimated fair market value of [$ value]. The amount of your contribution that may be tax deductible is limited to the amount you paid above that value: [$ amount minus value].
[Club name] is a tax exempt organization under section 501(c)(3) of the Internal Revenue Code. Our EIN is [EIN].
Please keep this letter for your tax records.
With thanks,
[Your name]
[Your role], [Club name]
Letter C. A year end summary
Letter C
[Date]
Dear [Donor name],
Thank you for supporting [Club name] during [year]. Here is a summary of your gifts for your records:
[Date of gift]: [$ amount] [goods or services received, if any, and their estimated value]
[Date of gift]: [$ amount]
Total for [year]: [$ total]
Unless noted above, no goods or services were provided in exchange for these contributions. [Club name] is a tax exempt organization under section 501(c)(3) of the Internal Revenue Code. Our EIN is [EIN].
With thanks,
[Your name]
[Your role], [Club name]