I have another fundraiser issue. We have a local bead shop that wants to do a fundraiser for breast cancer awareness. They have made a necklace and named it for a local young mother who was diagnosed with stage 3 breast cancer. They want to sell this piece locally and maybe even nationally. They want to sell the necklace for 100.00. $50 is the material cost so they want to make a $50 donation for each necklace sold. Any checks they send us we know is a donation from them. It gets muddy here: They want to place these necklaces in boutiques in the area and beyond and put a flowery card inside telling about the young mother and telling potential purchasers the proceeds from the sale of this necklace goes to breast cancer awareness. It will almost be like consignment selling. They have opted not to use our name on the card because they feel people outside our geographic area will not know who we are. They still plan on giving proceeds to us, though. My instinct tells me the only person getting the deduction is the bead shop who made the necklace and they only get one when they send us a donation. I also don't think it's our issue since we are not putting on the fundraiser...we're merely the beneficiaries of someone's generosity..and hopefully we will make a differnce by educating other young mothers who are below the age of baseline mamograms. Your input and opinions are appreciated. Our regular accountant is our of the office and we're looking for preliminary answers that may even open up more questions. Thanks!! Hillary Murphy Financial Administrator Phoebe Foundation

Well, I'm relatively new to all this - it's my first year at a non-profit. In my opinion your organization should be listed on the card even if they distibute the necklace nationally. My reasoning - people like to know specifically what the organization is who is benefiting from their donation (they can "look into" your organization) and also you may end up with donors who will continue to give to your organization. We have donors outside the state of Massachusetts even though our services primarily help children in Mass. Some people have heard about us through word of mouth and been impressed by our organization and want to give to us. Regarding who should get credit - I would say that the person buying the necklace and the store. The person who bought the necklace donated $50 to your organization and the bead store donated $50 in material cost to your organization. Hope this helps. Also, once the store has the necklace if you could put my name in a "tickler" file - my mom is a breast cancer survivor and I might be interested in purchasing the necklace! Thanks! Gretchen

Having just rec'd an opinion from the IRS on something similar, the buyer cannot take any deduction since the FMV is $100 (unless they have the option not to give $50); however, if they buy the necklace and then donate to another charity, their deduction would be $100. The maker of the necklace is entitled to the value of his/her supplies. Time is not deductible. (at least in the question that I asked about quilts that had $100 worth of materials and sold for $1,000). There may be a different answer for a retail value of a necklace...but the IRS didn't allude to one separate for businesses. I also agree that it would be nice to have your name on the tags, if indeed you trust the donor explicitly, and their intent is to give you all proceeds and not share with other non-profits in their marketing areas. Doris Romanisko - St. Peter's Hospital Foundation - Helena MT

The buyer of the necklace gets nothing. They paid a retail price for an item. The company has chosen to take their profit from this retail sale and make it a donation so they get a $50 tax deduction. I have worked with this previously when the organization I worked for were the recipients of donations from danschocolates.com (great chocolates by the way). With each purchase you can ask Dan's Chocolates to give a $ of their purchase to a charity listed on their site. Every month we simply got a corporate donation from them which was a percentage amount that chocolate buyers asked to go to us. The chocolate buyers were not the donors - they got something for their payment - they just had a say in where the company made their corporate giving. Dans would then get a tax receipt for the amount they sent to us. Hope this helps. Melissa Melissa S. Graves Databse Administrator Planned Parenthood of Connecticut [Email Removed] 203-752-2804