Hi, folks,

I posted yesterday about a situation I was facing wherein a board member
paid a contractor for some repairs, and I was unsure whether to call this an
inkind donation or a cash donation, since no funds actually passed through
our hands. Following Indigo's excellent advice, I posted to the Charity Law
forum and got the following response:

"Because the donation is a "settlement or cancellation of liabilities" (as
defined by the IRS) that would have been paid by your organization, you
can consider it a cash donation for which the donor would receive the
normal tax deduction.

The fact that no funds came into your hands is not relevant to whether or
not the donor made the gift.

We've had several of these types of "gifts", and our auditors have blessed
this interpretation for us!"

I was surprised by this and thought it was worth sharing here. Thanks for
all the feedback on this one!

Erica

Erica S. Maniez
Museum Director, Issaquah Historical Society
425/392-3500
[log in to unmask]
www.issaquahhistory.org

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