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External Relations Policies
UMB Policy on Accepting Gifts in Kind
External Relations | Approved June 21, 2018
Approved June 21, 2018.
Gifts-in-kind are valuable to University of Maryland, Baltimore (UMB), have tax implications for the donor, and may create tax-reporting obligations for UMB. To be accepted, a gift-in-kind must serve the mission of the School or administrative unit (either, a “Donee unit”) accepting the gift, be approved before acceptance, and be reported as outlined in this Policy. Internally, and for tax reporting purposes, a gift-in-kind is valued at its face or fair market value (the amount a willing buyer would pay a willing seller in an arm’s length transaction).
I. The Office of Philanthropy must be notified of all gifts-in-kind, because it is that Office’s responsibility to record gifts-in-kind for fundraising purposes and to provide tax receipts to the donors. The Office of Philanthropy also provides gift acknowledgement to the donor and refers the gift for appropriate donor stewardship.
II. In general, a gift-in-kind may be accepted by a Donee unit after it has been determined that the gift-in-kind will not result in a cost to the Donee unit, the campus, or its affiliated foundation.
III. The Donee unit should not incur costs for the present or future use, delivery, installation, display, insurance, maintenance, or administration of an acceptable gift-in-kind unless the donor, by separate gift or under the terms of the gift-in-kind, provides funding or a means to generate funding to cover such expenses. The accepting Donee unit shall be responsible for any additional expenses related to the acceptance, installation, use, disposition, and disposal not covered by the donor.
- Artwork, for example, may require expensive packing and transportation services for delivery to the Donee unit or special lighting or additional security to be displayed properly and safely.
- It may be specified that all or a part(s) of a gift-in-kind (e.g., part of an art or book collection) be sold to generate funds, which allow acceptance of other parts of the gift.
IV. Acceptance of a gift-in-kind requires approval by the appropriate officials of the Donee unit (including the Dean or designee of a School, or the UMB President or a vice president of an administrative unit) to ensure that acceptance will not involve financial commitments beyond what the Donee unit and UMB are willing and able to provide within current budgeted resources.
- If the gift-in-kind is of significant value or unusually complex, additional approval from the Office of Philanthropy’s Gift Acceptance Committee may be required. Marketability and/or need by the institution are major considerations in acceptance of these types of gifts.
V. In general, fees paid by a donor to determine the fair market value of donated property are not tax-deductible as part of the charitable contribution. Development officers and administrators should never provide tax advice to a donor. Donors should confer with personal tax advisors.
VI. The following gifts-in-kind require special consideration by UMB, regardless of value. If there are questions about a gift-in-kind or if a proffered gift-in-kind seems unacceptable or imprudent under this Policy, the Office of Philanthropy should be consulted (410-706-4385) for more information about next steps before making a determination about the gift. Gifts that require additional review include but are not limited to the following categories:
- Any goods offered as a gift from a UMB vendor, or a person or firm seeking to do business with UMB;
- Items considered to be of historical interest;
- Personal property that has not been inventoried by the donor or the donor’s estate;
- UMB does not generally accept gifts-in-kind of chemical, biological, or radiological material, including laboratory supplies or equipment, medical supplies or equipment, hazardous materials, any items subject to federal or state environmental hazard regulations as to shipping and handling, pharmaceutical products, food or beverage products, plants, animals, or fish. Donations of laboratory equipment require that the Donee unit provide assurance that the equipment is in serviceable condition and does not present a hazard to users or building occupants. Installing and/or connecting the equipment to building mechanical systems requires approval from UMB Operations and Maintenance. A Donee unit can apply for an exemption from this prohibition. At a minimum, the Donee unit must demonstrate that the material has unique value; will be used for approved research; can be handled in compliance with applicable regulations, and will not result in significant disposal costs. Exemptions described in this section must be approved by the Department of Environmental Health and Safety.
- The donor should never be provided with an estimated dollar value of a gift, as it is the donor’s responsibility to determine the value. Any acknowledgement or letter provided to the donor, including the official gift receipt, must include a description of the gift(s), with NO statement of dollar value. A donor should be reminded to confer with a tax advisor regarding the tax consequences of a gift-in-kind and any expenses incurred by the donor to value the gift-in-kind.
- The date that the gift-in-kind is delivered to the Donee unit will be considered the date of the gift.
- A dollar value for a gift-in-kind is needed for UMB’S internal accounting. IRS Form 8283, “Non-Cash Charitable Contributions” offers three categories of gifts-in-kind based on a donor’s declared value:
- If the donor declares the gift to be valued at less than $500, the IRS does not require special forms. Unless the Donee unit has reason to believe the gift-in-kind is worth substantially more than $500, the donor’s declared value may be used to value the gift for internal accounting purposes only.
- If a donor declares the gift to be valued from $500 to $4,999 and wishes to claim a tax deduction for a charitable contribution, the donor is required to file IRS Form 8283. It is the donor’s responsibility to obtain and complete IRS Form 8283, which will require the counter-signature of an authorized representative of the UMB Office of Philanthropy. The Donee unit may provide the signature of an internal staff member (i.e., faculty member or qualified professional) confirming a conservative value. This value will be used for internal UMB accounting purposes only.
- If a donor declares the gift to be valued at $5,000 or more, the donor, according to IRS regulations, should submit a partly completed Form 8283 to UMB. Only the Office of Philanthropy, Philanthropy Operations may complete this Form on behalf of UMB. The Form will then be returned to the donor.
- The Donee unit must notify UMB’s Property Accounting Department (410-706-6554) of all gifts-in-kind valued at $5,000 or more. The Department will coordinate any necessary property controls.
- The Office of Philanthropy/Development Operations must be informed if a gift-in-kind valued at more than $500 is sold, transferred, exchanged, or disposed of within two years of the date of the gift. The donor’s tax deduction can be changed by the disposition of the gift.
- UMB respects its donors’ rights to privacy to the extent allowed by law. Federal regulations state that the University MUST report disposition of a gift-in-kind valued at $500 or more (for which an IRS Form 8283 was filed) to both the IRS and the donor, if the property is disposed of within two years of the date of the gift. This report is filed with IRS Form 8282.
Donee unit is a School or administrative unit of UMB.
Gifts-in-kind are non-cash donations of materials or assets and may include such items as equipment, supplies, furniture, software, printed materials, or artwork.
Scope and Exceptions
Gifts-in-kind are accepted on a case-by-case basis by the Donee unit and receipted as such. Gifts of real estate are not covered by this policy. Generally, gifts of real estate are not encouraged, as they often result in liabilities and expenses not supported by the gifts; however, real estate and/or other non-cash assets may be used to fund planned gifts, which are coordinated through the Office of Philanthropy; Planned Giving and may be accepted by UMB or by the University of Maryland Baltimore Foundation, Inc. (UMBF), as determined by UMB.
Contact the Office of Philanthropy, Planned Giving (410-706-2069) or the Office of the Vice President for Administration and Finance (410-706-2802) for more information if a donor proposes a gift of real estate.