Community Benefit

Letters Restricting Donations

Please Take Note: The information provided does not constitute legal or tax advice. The material is provided for informational/educational purposes only. Please consult with counsel regarding your organization's particular circumstances.

Question: If we donate two first aid kits to a boy scout troop or donated other items, would we need to provide a letter restricting the use for those the same as you would for a cash donation?   

Recommendation: We recommend maintaining records of in-kind donations including the source of the requests, financial value and the community benefit purpose of the in-kind donation.

(November 2015)

Question: If making a donation to an organization whose entire mission is health-related community benefit - like American Cancer Society, is it really necessary to have the written letter restricting donation to a community benefit?

Recommendation:  The IRS Schedule H instructions require that donations be restricted in writing to one or more community benefit activities. This would include contributions to organizations with missions to provide community benefit.  

(November 2015)