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Helpful Hints for Year-End Giving

Many questions arise regarding the timing of the transmittal of various types of gifts to not-for-profit organizations when they come at the end of the calendar year. As a service to the alumni and friends of Hamline University School of Law, here is a quick overview that may be helpful as you consider your own charitable giving for 2007.

The general rule is that a gift is considered having been made at the time the donor relinquishes control of the asset.

  • Checks sent via the U.S. Postal Service. The date of the gift is the postmark on the envelope, not the date on the check itself.
  • For items sent via third party, such as FedEx or UPS, the gift date is the date the not-for-profit signs for the package, not the date it was sent. This is because the donor can still recall the package.
  • DTC stock transfers are considered gifts when the asset is deposited in the not-for-profit brokerage account, not the date the donor instructs the broker to make the gift. Pay close attention to this one. Every year there is a flurry of activity as donors make the call to their brokers in the last few days of December. It is not unusual for some of these last minute gifts to miss the deadline of December 31. Plan early for stock transfers.
  • It is also a good idea to notify the not-for-profit of stock transfers. Some brokerage firms do this for the donor, many do not and tracing the gift can be cumbersome after the fact. If the brokers do not notify the not-for-profits, then it can be very difficult to find out who to credit and thank for the gift.
  • Stock gifts made by transferring the actual certificate should be done by sending the certificate in one envelope or package and the stock power in a separate envelope or package. Note: the gift is considered complete based on the postmark of the latter of the two mailed envelopes or when the latter of the two packages (i.e. Fed Ex or UPS) is signed for by the not-for-profit.
  • Gifts by credit card are deductible in the year when the charges are made on the card owner's account. It is not the date you go online to fill out the form or authorize a gift office to charge your account. I.e. you may charge the gift on Dec. 20 but your credit card company may not process it until the January statement. This would be considered a 2007 gift. It is best to plan early for this type of gift.
  • Finally, please know that the IRS considers it the donor's responsibility to verify the date of the gift. Therefore, many not-for-profits indicate on gift receipts the date your gift was processed by them, not the actual gift date. It is a good idea to keep accurate records for gift made near calendar year end.

On behalf of the faculty, staff, and students at Hamline University School of Law ---Have a very Happy and Safe Holiday Season