Tax Documentation for Charitable Donations

With tax season upon us, many donors are searching for the appropriate tax documentation. Included below are some helpful insights to help prepare donors and employee campaign coordinators for acquiring tax documentation from the right organizations and in time to prepare taxes.

United Way Capital Area is planning to send tax receipts the week of February 23, 2009 to donors who gave $250 or above in a one time payment. UWCA cannot typically send tax receipts to payroll donors because the majority of companies do not provide UWCA with sufficient electronic donor detail with payments thus making it impossible to match up payroll payments to individual donors' accounts. If this is the case for a company, the payroll office will need to provide employees with a copy of their pledge form to substantiate their charitable gift. In addition, UWCA cannot provide tax receipts if we did not receive/process the donor's payment. Some companies use other third party processors who are responsible for providing tax receipts. United Way is happy to respond to donor requests for receipts if (1) United Way Capital Area processed your donation and (2) sufficient electronic donor detail accompanies payroll deduction payments from the company.

In preparation for questions from employees regarding tax receipts, we encourage employee campaign coordinators to familiarize themselves with the following:

• Know who processes employee donations and where you will direct inquiries as they occur.
• Know how employees can obtain a copy of their pledge form/electronic giving receipt if they have not retained one (payroll, HR, website login, etc.).
• Know where to direct employees when they have questions about what they need to claim a deduction.
  http://www.irs.gov/charities/article/0,,id=96102,00.html
  
  For donations less than $250, employees need proof of the donations in the form of a cancelled check, W2, or paystub. For gifts of $250 or above the donor also needs documentation in the form of a pledge card, on-line gift receipt, or other documentation that shows the name of the charity, date of the contribution, amount of the contribution, and that no goods and services were received. We recommend that each donor consult their tax advisor for more information about what they need.
• Educate employees about the need to retain a copy of their pledge form.