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What You Need to Know About Navigating This Tax Season

year-end giving statements

As we transition from the holiday giving season to tax season, let’s take a moment to reflect and celebrate. Our giving community donated $1 billion for the second consecutive year on the Givelify mobile donation app.

In 2022, more than 1.3 million generous people gave to 60,000 churches, places of worship, and nonprofits. Givers supported causes like hunger relief, scholarships, and housing and empowered places of worship to provide spiritual guidance to their congregations while doing impactful work in their communities.   

We salute the Givelify giving community for your joyful dedication to putting more good into the world.

As we kick off a new year, we now focus on tax prep and navigating end-of-year documentation.  

How Givelify helps your donors during tax season

Now is the time for organizations like yours to ensure your givers have what they need to file their 2022 taxes with the IRS. 

Every year, Givelify provides each donor with their Annual Giving Summary. This document is sent via email on or before Jan. 31. The summary includes the gross donations, visual graphs, and data from all gifts a donor has made using Givelify.

The summary does not include donations made with cash, checks, or through other donation platforms. 

Givelify provides the Annual Giving Summary to help donors ensure they get the most out of their tax deductions when it comes time to file. It’s for their internal records only. 

Additionally, donors can run their donation history off the mobile giving app any time of the year.

What should organizations provide donors?

To be clear, the IRS doesn’t accept Givelify’s giving summary. So, organizations will need to send one year-end contribution statement that directly incorporates all annual gifts to each donor.

That’s called the year-end giving statement, which donors should use to file their taxes with the IRS. 

The IRS requires that tax-exempt organizations send a formal acknowledgment letter for any donation that is more than $250. Donors will use this letter as proof of their donation to claim a tax deduction.

Generally, most churches, places of worship, and nonprofits provide written acknowledgment by January 31 of the year following the receipt of the contribution.

The year-end giving statement will include a person’s donations made through Givelify and any other donations made last year, either through a check, cash, or other means. Donors will include this statement with their 2022 tax return.

The good news is that organizations can create these statements and reports for their givers for tax purposes right from the Givelify Analytics Studio web portal. The Analytics Studio provides data and insights for empowering deeper meaningful connections between organizations and their donors.

Use your Givelify login to the Analytics Studio to create these statements from your organization’s dashboard. Here’s how.

Frequently asked questions you may receive from donors year-end contribution statement

See below as we answer common questions you may receive from your givers as they prepare for tax filing season.

What if a donor believes a discrepancy exists between their Annual Giving Summary and the organization’s year-end giving statement?

The Givelify Annual Giving Summary does not include donations made with cash, checks, or other donation platforms. The statement provided by your organization will have a higher gross amount than the Givelify summary because Givelify only tracks donations the donor made through Givelify. Learn more here.

What if a donor has multiple accounts?

If a donor has more than one giving account, they will receive one Annual Giving Summary for each account they have created. If they look at only one statement from Givelify and compare it to your organization’s statement, they’ll see a discrepancy.

The donor may solve this issue by merging their Givelify accounts. To consolidate these accounts and receive one summary, the donor can submit a support request or contact the Givelify Customer Support team.

The donor should be ready to: 

  • Provide the names and email addresses used for each of the accounts.
  • Provide which account will be maintained as the only giving account.

Givelify will merge all accounts, including the donor’s donation history, into one account.

What if your organization’s statement credits the donor for the total amount of their donation, less the Givelify fee?

There is no cost for donors to download and use the mobile giving app. With Givelify, there are no contracts, no signup fees,  no monthly fees, and no cancellation fees.

For organizations, a 2.9% + $.30 transaction fee is charged per donation made on Visa, Mastercard, and Discover. For American Express, the transaction fee is 3.5% + $0.30.

As an organization, you may wonder, “Should we give our donors credit for the gross amount of their donation or the net amount minus the Givelify fee?” This decision is up to your organization.

Givelify recommends that churches, places of worship, and nonprofits credit their donors for the gross amount of their donations.

The organization would then keep track of the transaction fees as the cost of doing business with Givelify and list it as an operational expense line item in its budget.

A mobile and online giving platform makes tax season easier

With Givelify, there are benefits organizations won’t get with using text-to-give codes or other platforms — such as helpful tools to save time on financial oversight and reconciliation, such as automated and custom reports, dashboards, and more.

This video tutorial highlights the numerous tools available in the Analytics Studio to help staff quickly manage finances, reconcile funds, and prepare for tax season.

 

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About the Author

Shanon Murray, Sr. Content Marketing Manager

Shanon is a marketing professional and content strategist with an MBA. As the Senior Content Marketing Manager at Givelify, she has a passion for exploring the intersection of faith, finance, and technology. Shanon also serves as the executive pastor of Victory Grace Center, which is based in Maryland.

Shanon Murray