When you receive a donation for a service, i.e., printing... or an item which would not be considered an asset, ie., lightbulbs, cleaning supplies, etc., how is the general ledger entry done? I assume the credit would be to a Gift-in-Kind revenue account. What is the debit?
Nancy Ehlers, Treasurer
Christ the King Seminary
711 Knox Road
East Aurora, NY 14052-0607
(716) 652-8900

Nancy: the debit entry would be the "expense" thats being donated. For example, if you get in-kind legal services, you would debit legal expense and credit the in-kind revenue account. That way, there is no effect on the bottom line of your operations, but you do reflect the "cost" of those services to your organization. Michael Bankert VP, Finance & Administration California State Parks Foundation

Nancy, The debit side is either an expense account or inventory. If it is something that does not have material value to your organization and will be consumed within the year, I would take it right to expense. If it is something of significant value that will be used over several year, for instance a 10 year supply of some kind of costly specialty spotlight bulb, then I would put it into inventory and recognize the expense as they are used. Tina Wilfer Development Assistant Fox Cities Performing Arts Center Appleton, WI [Email Removed]

Can anyone refer me to the IRS documentation that states what can be classified as gift-in-kind and what cannot? Daniel Sloane [Email Removed] The University of the Arts

I'm not sure that IRS Publication 526 has the answer to your question, but it has lots of other info on what is tax-deductible and what is not, so it might also cover gift-in-kind info. You can download IRS Pub 526 from the IRS web site. Kimberly Yang New Directions, Inc. Los Angeles, CA (310) 268-3695 www.newdirectionsinc.org