Partially Tax-Deductible Donations

When a donor gets something in exchange for their contribution (“quid pro quo contribution”), that donor is only entitled to a tax deduction for the amount contributed in excess of what the donor received in exchange. That makes the donation "partially-deductible."

For example: if a project hosts a fundraising event and sells tickets for $50, and provides entertainment and refreshments with a fair market value of $20, then only $30 of the ticket price is tax-deductible for the donor.

Example showing partially deductible donation

Fractured Atlas requires the project to use the “Standard Text for Partially Deductible Gifts” disclosure statement whenever it solicits a quid pro quo contribution or partially-deductible donation for which a donor makes a payment.

It is generally the recipient organization’s responsibility to make a good faith estimate of the fair market value of any goods and/or services received by the donor in exchange for their contribution. Each time a fiscally sponsored project provides goods or services in exchange for a donation, the project is required to report the value of the goods or services to the donor and to Fractured Atlas. A project may use any reasonable method to estimate the fair market value of goods or services it provided to a donor, as long as it applies the method in good faith. The project may estimate the value of goods or services that generally are not commercially available by referring to the market value of similar or comparable goods or services. Goods or services may be similar or comparable even if they are not exactly the same as the goods or services being valued.

Additionally, for any quid pro quo contribution, Fractured Atlas requires you to enter the fair market value as the “non-deductible amount” in the Online Donation Report form when processing check donations that are partially-deductible. We can accept credit card payments for partially-deductible gifts only if you set up Giving Levels on your online profile page before the donation is received or if you are running a crowdfunding campaign with approved rewards.