PPM Section 260-25

Printable Version

In this Section

Quick Links

Search the Policy Manuals

Policy and Procedure Manual

Chapter 260, Gifts and Endowments
Section 25, Gift Reporting Procedures
Approved: 11/6/98
Supersedes: 6/29/90

Responsible Department: University Relations
Source Document: UC Development Policy and Administration Manual

Exhibit A, Sample Letter of Acknowledgment--Cash Gift
Exhibit B, Sample Letter of Acknowledgment--Cash Gift with "Quid Pro Quo"
Exhibit C, Sample Letter of Acknowledgment--Non-Cash Gift
Exhibit D, Campus Gift Acceptance Report (UDEV 100-3)--Cash Gift - One Gift to One Fund
Exhibit E, Campus Gift Acceptance Report (UDEV 100-3)--Cash Gift - Several Gifts of Less Than $1,000 to One Fund
Exhibit F, Various Donors Information Sheet--Sample
Exhibit G, Various Donors Information Sheet
Exhibit H, Special Information for Donors--Gifts of Tangible Personal Property
Exhibit I, Campus Gift Acceptance Report (UDEV 100-3)--Gift-in-Kind
Exhibit J, Sample Letter to Family for Memorial Gifts

I. Purpose

This section explains how to report and acknowledge gifts to The Regents of the University of California. Gifts to UC Davis may also be made through the UC Davis Foundation. Where appropriate, applicability to The Regents and the Foundation have been noted.

II. Definitions

Refer to Section 260-15 for definitions.

III. Procedures

These procedures are generally applicable only to Regents gifts, except where indicated. Refer also to instructions on the Campus Gifts Acceptance Report (Form UDEV 100-3). Call the Gifts Acceptance Unit (757-3462) for assistance with gifts that do not fall within the categories listed below.

A. Cash gifts

Responsibility	Action
Unit head or designee	1. Determines that funds received are within definition of gift in Section 260-15. Checks must be made payable or endorsed to The Regents of the University of California, to UC Regents, or to a valid University fund name. Checks received that are not gifts should be handled in accordance with Section 330-55. 2. Immediately date stamps all donor correspondence. 3. Immediately restrictively endorses any check with endorsement stamp available from Accounting & Financial Services; makes 2 copies of check (do not reduce copies) to attach to Form UDEV 100-3 (see Step 7, below). Copy both sides of check if payee is other than The Regents or a valid University fund name. 4. Prepares statement of cash collections; deposits currency, coin, or checks at Cashier's Office. Each donation must be deposited by statement of cash collections in a central campus account (account 1160120, object code 0630). The funds will be released to the department after Form UDEV 100-3 has been processed. Campus departments prepare the statement of cash collections through the UC Davis Financial Information System (DaFIS); UCDHS departments prepare a paper form. For instructions and samples, refer to Section 330-55 and the DaFIS User's Guide. 5. Promptly sends donor written acknowledgment of receipt of gift (see Exhibit A, Exhibit B and Exhibit C). The acknowledgment must not state acceptance of the gift. Acknowledgment letters should contain the dollar amount of the gift, the date received, and a clear and specific description of the donor's intended uses for the funds (taken directly from written donor instructions whenever possible), and should adhere to IRS substantiation guidelines. 6. Types Campus Gift Acceptance Report, Form UDEV 100-3 (Calcode 71461-257). (See Exhibit D and Exhibit E for sample forms.) Include the following information on the form: a. In Item 1, directly adjacent to the Donor Name, enter the DaFIS Statement of Cash Collections document number. b. In Item 15, provide both the legacy Loc/Account/Fund/Sub and the DaFIS account number. c. In Item 15, if the gift requires a new DaFIS account, cite the new assigned number and the Account Maintenance document number used to create the DaFIS account. If a new DaFIS account is required, send an advance copy of the UDEV 100-3 to Extramural Accounting, Accounting & Financial Services, citing the Account Maintenance document number. A gift written to more than one fund number must be processed on separate gift forms regardless of the value. Twelve or fewer small donations (less than $1,000 each) to a common fund can be reported on a single gift form following "various donors" format. (See Exhibit F for an example. Exhibit G, Various Donors Information Sheet, may be copied from the manual.) 7. Staples following items to Form UDEV 100-3: Donor's transmittal letter (original and 1 copy). All gifts must have donor's written instructions as evidence of donor's intent before acceptance can occur. In the absence of a donor transmittal letter, departments may submit the following documentation to support the donor's intent: a. Deed of gift form. b. Copy of proposal or solicitation letter used to solicit the gift. c. Copy of other correspondence from the donor referencing the intended gift and its use. d. Remittance advice (check stub) instructions, if they clearly match the terms and conditions reported by the department. Copies of check (2 copies). Department's letter of acknowledgment (2 copies; if all donors on one gift form received same letter, submit only 2 copies marked "sample"). Correspondence related to gift, such as letters of inquiry or interest (see definition in II-G, above) (2 copies). For various donor gifts less than $1,000, various donors list (2 copies). 8. Routes Form UDEV 100-3 and attachments for signature in the order listed: Vice chancellor/dean or authorized designee. (See Section 260-15 regarding signature authority to submit gift forms.) Gifts Acceptance Unit, Advancement Services Office, University Relations.
Gifts Acceptance	9. Reviews gift form for adequacy of documentation. For gifts of $1,000 or more not adequately supported by donor instructions, Gifts Acceptance will notify the department in writing that additional documentation will be required within 30 days from the date of notice. If Gifts Acceptance has not received appropriate supporting documentation within 30 days, a letter will be sent directly to the donor requesting confirmation of the terms and conditions of the gift as outlined by the department, as well as verification that no goods or services were exchanged in return for the gift. Departments will then be provided with copies of the donor's signed confirmation. 10. Where appropriate, forwards gift form to Office of Research, Scholarship Office, or other offices for signature, review, and/or comment. 11. Arranges for formal acceptance of gift by Chancellor or appropriate designee, or by the President or The Regents if required.
Accounting & Financial Services	12. Transfers deposit from central campus account and budgets gift amount to appropriate expenditure account.

B. Pledges and pledge payments

A pledge must be in writing from the donor and must state the total amount of the pledge, the expected payment schedule, and the planned payment amounts. A pledge is reported on Form UDEV 100-3 when received. Subsequent payments on the pledge are deposited by the department and do not require gift forms (see Step 4, below).

Responsibility

Action

Unit head or designee

1. Determines from donor correspondence that the total amount of the pledge, the expected payment schedule, and the planned payment amounts are specified.

2. If initial payment is received, follows steps in III-A, above; or,

If no initial payment is received, date stamps correspondence and begins at Step 5 in III-A, above.

3. On Form UDEV 100-3, Item 11, Gift Pledged, enter the full amount of pledge, whether or not initial payment is received; enter amount of any initial payment received in Item 12, Gift Received.

4. If subsequent pledge payments are received, deposits payment to account 1160120, object code 0630, in accordance with applicable procedures in III-A, above.

C. Gifts-in-kind

It is important that a department receiving a gift-in-kind consider possible implications regarding storage, maintenance, and licensing of that gift. For gifts of software, contact the Purchasing Department regarding licensing. Acceptance of gifts of vehicles or trailers requires the prior approval of Fleet Services. Acknowledgment letters to donors of such gifts should not state the value of the gift-in-kind.

Responsibility	Action
Unit head or designee	1. Provides donors with information relating to IRS requirements. (Exhibit H presents information in summary form and may be reproduced for donors.) 2. If requested by donor, provides donor with IRS rules and Form 8283, Noncash Charitable Contributions. (Departments may obtain current copies from Gifts Acceptance.) 3. Processes Form UDEV 100-3 as in III-A, above (see Exhibit I); estimates value of each gift in Item 13 of Form UDEV 100-3, if not provided by donor or qualified appraiser. 4. If donor provides IRS Form 8283, attaches original to Form UDEV 100-3; assures that donor has completed the following information on Form 8283, Section B: Donor name. Donor identification number. Description of property at time of gift. The donor need not provide the University with other information such as copies of formal appraisals. If the appraiser signs Form 8283, however, an appraised fair market value must also be noted on the form. If the donor or appraiser provides a value on Form 8283, enter that value on Form UDEV 100-3 (Item 13); they must agree. Identify on Form UDEV 100-3 the way in which the value was established. 5. If Form 8283 is provided by donor at a later date, forwards original to Gifts Acceptance with copy of fully processed (yellow) Form UDEV 100-3; assures that donor has completed necessary information on Form 8283 as indicated in Step 4, above. If the gift has not been sold or otherwise disposed of, note "not sold" on the copy of Form UDEV 100-3. If the gift has been sold or otherwise disposed of, note on the copy of Form UDEV 100-3, "sold," the month/day/year of sale, dollar amount obtained, and, if applicable (for animals), RDB number. (See Section 340-30 for RDB information.)
Gifts Acceptance	6. Completes necessary information on IRS Form 8283; sends original Form 8283 to donor and retains copy with the gift form. 7. If Form 8283 is provided by donor after Form UDEV 100-3 has been processed, and has been signed by appraiser, verifies that gift value in campus gift records agrees with Form 8283; if necessary, changes previously reported value to agree with official appraised value; notifies department of the change.
Department	8. Whenever a gift-in-kind is sold, immediately notifies Gifts Acceptance. Sales of gifts of animals are reported following the procedure outlined in Section 340-30 and in special instructions issued to appropriate departments. Sales of other gifts-in-kind are reported by noting on a copy of the processed (yellow) Form UDEV 100-3, "sold," the month/day/year of sale, and dollar amount obtained.
Gift Acceptance	9. Upon receipt of notification of sale, files IRS Form 8282, Donee Information Return, with Internal Revenue Service within 125 days of date of sale, with copy to donor and to department. Note: Departments should be aware of possible donor relations implications when Steps 6 and 9, above, occur simultaneously.

D. Memorial gifts

Refer also to Section 260-40. If gifts are received in memory or in honor of an individual, such information should be noted in Item 9 on Form UDEV 100-3, along with the name and address of the family to be notified. If the "various donors" format is used, note on the Various Donors Information Sheet the name of the person to be memorialized or honored (see Exhibit F). Copies of letters to the family and any attachments must be attached to Form UDEV 100-3 as acknowledgment correspondence; the dollar amount of the contribution is not to be included in the notice to the family (see Exhibit J). Lists of donors forwarded to the family should be in alphabetical order and should contain addresses of those donors.

E. Securities

1. If securities are proffered by a donor or received by a department, immediately telephone Gifts Acceptance (757-3460 for Regents gifts, 757-3457 for Foundation gifts) to determine whether the securities can be accepted. Before accepting securities, the campus must ascertain whether they are marketable by calling the Treasurer's Office or a broker. Although unmarketable securities may be accepted, they will provide no immediate benefit and their future benefit is a calculated risk.

2. Securities received directly by departments must be hand delivered to Gifts Acceptance for processing. Additionally, Gifts Acceptance (757-3210) should be notified in advance of any securities transfers made in accordance with the procedures outlined in 3, below.

3. The Treasurer is the official custodian of all securities belonging to The Regents; therefore, all such securities must be transferred to the Treasurer directly by the donor or immediately upon receipt by the campus. Securities may be transferred to the University in one of two ways:

a. Securities eligible for Depository Trust Company (DTC) transfers should be transferred to The Regents' custodian bank through the donor's bank trust department or a securities broker. These agents should be instructed to contact the Treasurer's Office immediately for instructions regarding the disposition of the securities. (Only the Treasurer may authorize the sale of securities on behalf of The Regents.)

b. Alternatively, certificates bearing the name of the donor may be endorsed to Shellwater & Co. and transmitted to the Treasurer directly by the donor or by the campus. Donors may mail to the Treasurer's Office either:

1) An unendorsed stock certificate and a signed stock power naming "Shellwater & Co.", each mailed in a separate envelope, or

2) A dated stock certificate endorsed to Shellwater & Co.

In either case, the Treasurer's Office must be informed of the donor's intended purpose for the gift, so that the correct campus and account can be credited. (The Treasurer's Office Gift Coordinator may be contacted by calling (510) 987-9685.)

4. Since securities are processed through the Office of the Treasurer of The Regents, it may take several weeks for the transaction to be completed. At that time, Gifts Acceptance will send information to the department for completion of Form UDEV 100-3 and preparation of acknowledgment letter.

F. Bequests and testamentary trusts

If information about a bequest is received by a department, it should be forwarded promptly to the Director of Planned Giving, Development Office.

G. Real property

If a gift of real property is proffered by a donor to a department, immediately telephone the Director of Planned Giving, Development Office (757-3231).

H. Corporate matching gifts

Original company match forms received with the donor's gift should be attached to Form UDEV 100-3 and forwarded to Gifts Acceptance for processing. Matching company checks received in departments should be processed in accordance with applicable procedures in III-A, above. Unless otherwise specified by the donor or the matching company, matching gifts are deposited and processed on Form UDEV 100-3 to the same account as the original gift.

I. Gifts for research

Gifts for research that fall into the definition of a gift in Section 260-15, are processed on Form UDEV 100-3 in accordance with applicable instructions in III-A, above. A Principal Investigator's Statement of Economic Interests, Form 730-U, is required if the donor designates a specific principal investigator or specific research project and the gift exceeds $250. If the principal investigator indicates any financial interest in the sponsor company, he/she must also complete the Principal Investigator's Addendum to Statement of Economic Interest. (See Sponsored Research Manual Section 305 and Academic Personnel Manual Section 028.)

J. Endowments

Some endowments are established with a one-time gift. Others are established as a result of many donations to one fund, such as a memorial scholarship fund to which many donors contribute. Each gift establishing or adding to an existing endowment fund is processed in accordance with applicable instructions in III-A, above.

K. Fund functioning as an endowment

As with gifts to endowment funds, each gift to a fund functioning as an endowment is processed in accordance with applicable instructions in III-A, above. Departments wishing to change a current use fund to a fund functioning as an endowment should submit their requests in writing to their vice chancellor/dean, who will forward the request to the Associate Vice Chancellor--University Relations for routing to the Chancellor for approval. Such requests should include the name of the fund and the reasons for the request.

L. Industrial or corporate affiliate programs and other gifts involving quid pro quo benefits

1. Criteria

Corporate affiliate program memberships are administered as gifts by University Relations. For memberships to qualify as gifts, terms of membership may not include support for specific research programs, nor may they conflict with University regulations regarding patents and intellectual property. Indirect costs are not assessed. Membership payments are used at the discretion of the program. If membership payments exceed the fair market value of benefits received, the excess of the amount paid over the documented fair market value may be tax deductible.

2. Departmental procedures

The benefiting department is responsible for establishing, in accordance with University policy and IRS regulations, a fair market value for the quid pro quo benefits received and for disclosing this value to donors and potential donors in solicitation and acknowledgment materials. The benefiting department must submit proposed terms of membership, the fair market value of benefits, and solicitation and acknowledgment materials for advance review by Advancement Services, University Relations, on behalf of the Associate Vice Chancellor--University Relations.

3. Quid pro quo disclosure

a. A contribution involving a quid pro quo is a contribution made to the University by a donor that includes an amount that in effect represents payment for goods or services provided to the donor by the University. The University must provide a written disclosure statement to donors of a quid pro quo contribution in excess of $75 (1996 figure adjusted annually for inflation). The required written disclosure statement must:

1) Inform the donor that the amount of the contribution that is deductible for Federal income tax purposes is limited to the excess of any money (and the value of any property other than money) contributed by the donor over the value of goods or services provided by the charity, and

2) Provide the donor with a description of the goods or services received and a good faith estimate of their value.

b. The required written disclosure statement must be furnished in connection with either the solicitation (if one exists) or the receipt of the quid pro quo contribution. If the disclosure statement is furnished in connection with a particular solicitation, it is not necessary for the University to provide another statement when the associated contribution is actually received, though this is considered desirable.

c. A penalty may be imposed on the University if the required disclosure is not made. The penalty is $10 per contribution, not to exceed $5,000 per fund-raising event, mailing, or solicitation.

d. No disclosure statement is required if any of the following is true:

1) The goods or services given to a donor have insubstantial or de minimis value, defined by the IRS as:

a) Low-cost items costing less than $6.70 (1996 figure adjusted annually for inflation) for contributions of $33.50 (1996 figure adjusted annually for inflation) or more.

b) Free or low-cost items distributed unordered to patrons.

c) The fair market value does not exceed 2% of the contribution or $67 (1996 figure adjusted annually for inflation), whichever is less.

2) The payment received does not exceed the fair market value of the goods or services received; i.e., in such cases there is no contribution-the amount paid represents a purchase of goods or services only.

3) There is only an intangible religious benefit provided to the donor.

4) The donor makes a payment of $75 or less per year and receives only annual membership benefits that consist of:

a) Any rights or privileges (other than the right to purchase tickets for college athletic events) that the taxpayer can exercise often during the membership period, or

b) Admission to events that are open only to members and the cost per person of which is within the limits for low cost articles, currently $6.70 (1996 figure adjusted annually for inflation).

4. Quid pro quo valuation

a. The benefiting department may use any reasonable method to estimate the fair market value of goods or services it provides to a donor, provided the basis for this determination is well documented. The department may estimate the fair market value of goods or services that generally are not commercially available by using the fair market value of similar or comparable goods or services. Goods or services may be similar or comparable even if they do not have the unique qualities of the goods or services being valued. The cost of providing the goods and services has no bearing on the fair market value, only the cost to the donor of obtaining the same or similar goods and services is germane.

b. Newsletters or other publications that are not of commercial quality are treated as though they do not have a measurable value as long as their primary purpose is to inform members about the activities of the department or program and are not available to the public through subscriptions or newsstands. Publications containing articles written for compensation and that accept advertising are considered commercial quality publications. Professional journals are considered commercial quality publications.

c. If "advertising" space in a publication is offered as a benefit of membership, it is nondeductible and the fair market value of the advertising must be deducted from the total payment if any of the following is true:

1) The same or similar space in the publication is offered for sale to others at a predetermined amount.

2) The donor receives an unfair competitive advantage as a result of the ad.

3) There is no donative intent.

4) The ad mentions specific products, services, or costs.

d. In cases where membership payment includes the right to purchase tickets to college athletic events, payments are only partially deductible. The fair market value of the right to purchase tickets is set at 20% of the total payment, up to $62.50 per ticket.

5. Refusal of benefits

If the benefits offered are explicitly refused by the donor, the Federal income tax deduction is not reduced by the amount of the quid pro quo (the goods and services that might have been provided). Benefits can be rejected through the use of a check box on the solicitation form, or in writing at the time the gift is made. Failure by the donor to use the offered benefits is not sufficient evidence of "nonreceipt" of a quid pro quo benefit.

M. Deferred gifts

Gifts of insurance, charitable remainder trusts, and other types of deferred gifts should be discussed with the Director of Planned Giving, Development Office, before any action is taken by a department.

IV. Reference

UC Development Policy and Administration Manual.

V. Further Information

Further information on gift reporting procedures may be obtained from the Gifts Acceptance Unit, 757-3462.