What is a donation receipt?
Donation receipts, or donation tax receipts, provide official documentation of a gift made by a donor. Often written in the form of an acknowledgment letter, they let the donor know that their donation has been received and allow the nonprofit to express its gratitude. Nonprofits also use donation receipts to provide donors with essential information needed for tax purposes.
What’s the best format for your donation receipt?
Due to the critical information contained within a donation tax receipt, these receipts must follow a specific format. According to the IRS, donation tax receipts should include the following information:
- The name of the organization
- A statement confirming that the organization is a registered 501(c)(3) organization, along with its federal tax identification number
- The date the donation was made
- The donor’s name
- The type of contribution made (cash, goods, services)
- The value of the contribution
- Additional information specifying if the donor received anything in exchange for the donation
- Name and signature of an authorized representative of the organization
Types of donation receipts
Let’s take a closer look at some of the different types of donation receipts that you might send to supporters:
- Charitable donation receipt. A charitable donation receipt is a letter, email, or receipt form notifying a donor that their gift has been received. Charitable donation receipts contain information regarding the gift (donor name, organization name, gift amount, gift type, etc.). According to the IRS, nonprofits must recognize any gift over $250 with a receipt.
- In-kind donation receipt. In-kind gifts come in the form of goods or services rather than money. Gifts of goods do hold a dollar value and are tax-deductible; gifts of time and service do not hold a dollar value and are not tax-deductible. The donor, not the nonprofit, must determine the monetary value of goods donated. In-kind donation receipts should include the donor’s name, the description of the gift, and the date the gift was received.
- Cash donation receipt. A cash donation receipt provides written documentation of a cash gift. The receipt proves the transaction’s authenticity to the government, should the donor wish to deduct the contribution from their total income.
- Stock gift donation receipt. A stock gift donation receipt details the gift of stock shares of a corporation. The receipt should include the number of shares and the corporation’s name but should not place a monetary value on the shares. While not required, it is best practice to send a follow-up letter that reports the quantity and value of the donated shares on the date of the gift.
- Silent auction receipt. Organizations should provide receipts to every silent auction attendee who leaves the event with items they purchased. The receipt should include the organization’s name, the date of the event, and the names and values of each item the attendee purchased.
- End-of-year donation receipts. Your organization must send end-of-year donation receipts, also known as year-end giving statements, to certain donors who contributed $250 or more to stay compliant with government regulations and to allow your donors to deduct their donations from their taxes.
Can you create templates for your donation receipts?
We recommend creating email and letter templates for your donation receipts. Templates help ensure that you include the information you need in all your receipts. They also save time by automating your receipts.
Consider creating these types of donation receipt templates:
- Donation and non-cash gifts
- Recurring donations (including monthly gifts)
- Failed donations
- Expiring card
In your templates, you should leave room to include all of the information required by the IRS, along with a sincere thank you message telling the donor how much their contribution means to your organization.
Store these templates in your donor management software to send automatically after a donor gives (or attempts to give). For example, Bloomerang’s donor management system allows you to record standard donation receipt templates and customize them using donors’ names, donation dates and amounts, and the name of the campaign they supported.
Tips to make your donation receipts more engaging
Just because you use templates for your donation receipts doesn’t mean they have to be boring. There are several ways to create compelling donation receipts.
We recommend incorporating engaging multimedia content such as:
- Short videos with firsthand testimonials from your beneficiaries
- High-quality photos of beneficiaries or volunteers in action
- Links to educational or inspirational blog posts
- Links to your social media accounts for supporters to follow your organization on multiple platforms
If you add creative content and present it compellingly within your donation receipts, you can engage your donors and encourage them to continue supporting your organization.
The bottom line
Donation receipts contain valuable information donors will appreciate having once tax season arrives. You can create compelling receipt templates that help you save time and ensure you include the most crucial information.
- Donor Appreciation: Creating a Strategy (And 22+ Ideas!). Create a well-rounded donor appreciation strategy using these tips from Bloomerang.
- Donation Receipt Email & Letter Templates For Your Nonprofit. Borrow these donation receipt templates to help develop ideas for your organization’s receipts.
- Donor Thank-You Letters: What You Need to Say & 16 Free Templates. Explore the donor thank-you letter templates in this guide for more details on what to say in an effective donor thank-you letter.