Table of contents
Published October 27, 2026.
Decide what the gift actually is
A donated printer, a free venue, and a lawyer's volunteer hours are three different gifts. Record goods, services, and use of space separately. The program use and the date received matter as much as the description, because a later reviewer will ask how the gift advanced the mission.
Use the donor's value, with a caveat
For noncash goods, the donor generally determines the value and the organization acknowledges the donation without assigning a tax value. Record the donor-stated amount and note that the donor is responsible for substantiation. Do not multiply a retail price by an estimated quantity to create a number the donor never provided.
Handle services carefully
Volunteer time is not a charitable contribution for the volunteer's tax return, though it may be valuable for grants and internal reporting. Professional services donated by a business may need different documentation. Mark the category clearly so the acknowledgment does not imply a deduction that does not exist.
Disclose quid pro quo benefits
If the donor receives a dinner, a table, or merchandise in exchange for the gift, state the value of the benefit and acknowledge only the excess. The disclosure belongs on the acknowledgment, not in a private note. When the benefit value is uncertain, ask the event lead before the letter goes out.
Issue acknowledgments on a schedule
Acknowledge gifts promptly and batch the routine ones on a weekly cadence. Keep a list of gifts awaiting donor value, missing addresses, or benefit calculations. A gift that sits unacknowledged for a month is harder to substantiate and more likely to produce a donor question.
Record custody and restrictions
A donated vehicle, equipment, or artwork may carry insurance, storage, and disposition requirements. Record where the item is held, who is responsible for it, and any donor restriction on sale or transfer. A restricted in-kind gift is not available for general use.
Reconcile the in-kind ledger to the letter log
At month end, compare the in-kind ledger to the acknowledgment log. Every recorded gift should have a letter, a documented reason for no letter, or a pending status with an owner. Differences usually reveal gifts entered twice or letters sent without a ledger entry.
An event example
A bakery donates 400 pastries for a fundraiser and also pays for a table. The pastries are an in-kind gift with a donor-stated value and a program use. The table purchase is a sponsorship with benefits, so the acknowledgment separates the tax-deductible portion from the value of the seats and meals.
What to keep
Keep the donor letter or email stating the value, the receiving staff member, the date, the program use, the acknowledgment copy, and any benefit disclosure. If the gift is sold or transferred, add the disposition record. The file should let a reviewer reconstruct the gift without contacting the donor.
- Donor and date
- Goods or services
- Donor-stated value
- Program use
- Benefit disclosure
- Custody and restrictions