Friday, November 23, 2018

Hey Fletch … I have a question related to a special donation. A family in our church had a very unexpected death in their family. Another family in the church would like to pay for the funeral cost. They would like to do that by giving to the church, for two reasons. First, the gift could be anonymous. Second, the gift could be tax deductible. Is this type of gift acceptable with the IRS?

DRF—The way that you have described it, it is pass through giving. That can be done but not as a tax deductible gift. This allows for anonymity but not a tax deduction.

Check out the “Hey Fletch” column, “Attorney’s Perspective on Designated Funds” from Thursday, November 1, 2018. Another column to read is “Special Offering for a Woman with Cancer” from Thursday, September 20, 2018.

The family can give funds to your benevolence or compassion ministry. You can use some or all of the funds for the funeral. The bottom line is that the church must be in total control of the funds and that the person cannot designate that use of the funds for an individual. 

Trying to stay on the right side of the law is complicated!