Planning a party for your sponsored project? Here are a few tips...
With so much focus on online fundraising and crowd funding these days, it's easy to overlook one of the most tried and true methods of raising cash for your project... event fundraisers and house parties. Whether it is used as a launch party for a crowd funding campaign or a free standing fundraiser, here are a few tips if you are planning to throw an event to raise money for your IDA sponsored project:
Get the invite right
Invites should go out at least a few weeks before your event, possibly longer if you are hosting something during the busy upcoming holiday season. Save yourself stress and added expense by sending us a copy of the invite to approve a couple of weeks before it goes to your guests. You can always check out the handbook for some preapproved language regarding tax-deductible gifts.
Make it easy to give
Starting next month we'll be offering projects the option to accept credit card donations on site using a convenient GoPayments app on your smartphone or tablet! Contact us for more details or look for more information in the handbook shortly. But when sending your invites, consider including a mail in card with all of the details they will need to make a check, credit card or online donation, so even those who can't make it to the event find it easy and convenient to give.
Know what's deductible
Fundraising events have a few special considerations when it comes to the question of what donations are tax deductible. Here's a brief primer:
- Admission - If you are offering your guests food, drinks or entertainment in return for an event ticket, the cost of admission is not fully deductible. You'll need to assign a fair market value to the items or services your guests are getting in return for a ticket. If your guests are paying more than that amount for a ticket, they can count the difference as a donation. This is true even if all the food and drink at the event was given to you for free. Check out the section on partially deductible donations in our handbook, and contact us if you still have questions about handling ticketing and partially deductible gifts.
- Auctions – Auctions can be a great way to bring in funds at a fundraiser, but the price people pay for items rarely results in a write off. That's because for something to be deductible, the winner would have to be paying over fair market value for the item they cast the winning bid on. That means if you auction off a $500 painting for $200, your donor gets a deal, but not a deduction. If the bidding gets heated and they pay $700 for it however, they get to write off $200 as a charitable gift. If you are collecting auction funds, make sure to contact us in advance so we can walk you through filling out the partially deductible donations spreadsheet that will have to accompany your donors' checks.
- Raffles – Raffle tickets are never tax deductible according to the IRS. Due to our inability to monitor raffles in accordance with individual State gaming regulations, if you want to have a raffle at your event check out the rules in your State and know that raffle ticket sales should go directly to you or your company, not to IDA.
Keep track and follow up
For at least a few weeks after your event, put in regular requests for an account balance at www.documentary.org/sponsorship so you can promptly thank donors for gifts that trickle in after the event. If an attendee makes a pledge to give after the event, give him or her a couple of weeks to follow through and then follow up by email or phone if the donation doesn't materialize.
Look for more resources and tips on fundraisers and house parties in my next blog post.