Donor acknowledgments and filing IRS Forms 8282 and 8283
Published August 2, 2018
Your organization probably already has a protocol in place to ensure that every donor gets a show of appreciation and a receipt with the information to claim a charitable contribution deduction on their tax return. But your obligations may go further than that — for a noncash donation, you might also need to consider Forms 8282 and 8283.
Forms for noncash charitable contributions
Any donor must attach Section A of Form 8283, “Noncash Charitable Contributions,” to his or her tax return if the amount of the charitable deduction for all of their noncash donations is more than $500. But only when a single noncash contribution is greater than $5,000 does the donor need to complete Section B, which must be signed by an official of your organization.
The signer may be an official authorized to sign your organization’s tax returns or another person specifically designated by that official. When you return Schedule B to the donor, they should provide you with a full copy of Form 8283. Certain publicly traded securities for which market quotations are readily available on an established securities market should be included in Section A instead of Section B.
If the value of the donated property is over $5,000 the donor must usually get an appraisal. Note: Your official’s signature on Form 8283 doesn’t represent concurrence with the appraised value of the donation. It merely acknowledges receipt of the described property on the date specified on the form. The signature also acknowledges Form 8282 information reporting requirements for dispositions.
Your organization will generally need to file Form 8282, “Donee Information Return,” with the IRS if you sell, exchange, or otherwise dispose of a donated item within three years of receiving the donation. You must file the form within 125 days of the disposition unless:
- The item was valued at $500 or less at the time of the original donation, or
- The item was consumed or distributed without compensation in furtherance of your exempt purpose. For example, a relief organization that distributes donated medical supplies while aiding disaster victims isn’t required to file Form 8282.
You also must provide a copy of Form 8282 to the donor. When a donated item is transferred from one nonprofit to another within three years, the transferring donee must provide the successor donee with its name, address and tax identification number, a copy of the Form 8283 it received from the original donor, and a copy of the Form 8282 within 15 days after filing with the IRS.
Remember to track the Forms 8283 signed and Forms 8282 filed each year, as you must disclose those figures on your Form 990. Keep a copy of signed Forms 8283 for at least three years. You’ll need that information to complete Form 8282 if the donated item is later sold or disposed of.
The failure to file required forms can lead to IRS penalties. While your organization may be excused if you show the failure was due to reasonable cause and not simply willful neglect, your donor still stands to lose the deduction — a result neither of you want.
For more information, please contact MCM Tax Manager Kim Marley, CPA via e-mail or phone (502.882.4596).