Gift Accounting for Virtual Events

Cheena DeAraujo-Desir

We have had to cancel our Enshrinement Weekend due to COVID-19. In lieu of this and other in-person events, we are hoping to do a group of Happy Hours via Zoom or other platforms that donors would pay to attend. These have no cost or Fair Market Value as we are not paying for obvious things like catering, etc. However, I have run into the issue of how to allocate these funds appropriately.

Before COVID-19 Standard Cultivation Event

Allocated to Special Events Fund

Total Purchase = Contribution + Fair Market Value

1,000 = 750 (CTRB) + 250 (FMV)

During COVID-19 Virtual Experience/Zoom events

Question of Allocation in play here. Should this be allocated all to Donations or still be allocated to Special Events and be 100% tax deductible? And why?


Total Purchase = Contribution + Fair Market Value

1,000 = 1,000 (CTRB) + 0 (FMV)


I mean it is still events (individuals are paying to attend events). If these go well, then they wish to continue this kind of programing and cultivation. I tried looking up documentation on this but have come up with nothing. Is this new? Can someone in Accounting or CPA-type answer this for me with some back up? Our accounting team is saying that it needs to be separate in the GL (which I get), but why? I need justification to explain to our Fundraisers.


Cheena

Elizabeth Perron

Hi Cheena DeAraujoDesir‍,


First, what a well written organized post!  Secondly, I've noticed a peer has not answered your question yet.  Do you want me to move this to FENXT so there will be more people that work with GLs to hopefully respond?


In harmony and inclusion,

Elizabeth

Blackbaud Management Team

Cheena DeAraujo-Desir

Yes. Please. I am really struggling here.

Elizabeth Perron

Moved this forum post to the FENXT Community in hopes of getting more product specific eyes & replies...

Kim Szalkus

Hi Cheena - 


We had the same issue, and I had similar questions.  We have had some live functions turn into virtual events.  We have had other live functions canceled and the donors have told us to keep their paid event fee and consider it an donation.  I was scratching my head on whether both of these items should be considered "Contributed Support" or "Event" Revenue for external reporting and for our 990.


Our auditors told me that if we have an actual "program", a speaker or presentation that donors can participate in (even if it is via WebEx/Zoom), then it is an "Event".  If there is no program associated with the canceled event, then the donations are Contributed Support (and not event revenue).


Your calculations on the total amount that is tax deductible looks correct.


Hope that helps.  I am an accountant and a CPA, but not an auditor.  I would have your auditing firm give you their interpretation.


Good luck.

Cheena DeAraujo-Desir

Thank you for answering this. I knew there was a logical breakdown but I couldn't figure out what it was.