Uncleared Checks

deb · Post by **deb** » Sat Dec 11, 2004 7:00 am

How do you change an uncleared check into a contribution? A donor has asked me to revert an uncleared (misplaced) check as a tithe contribution.

Thanks, Deb

Matt · Post by **Matt** » Sat Dec 11, 2004 7:28 pm

If I understand your question correctly, the donor has written a check to your church but for some reason your church never got it and it also never cleared the donor's bank statement. Sounds kind of suspicious to me. I'd recommend that the donor write you another check and the donor reverse the original check to clear their check register. Depending on the amount and how long ago it was written, the donor may also want to put a stop payment on the original check.

deb · Post by **deb** » Sat Dec 11, 2004 8:31 pm

Actually, it's the other way around. The church wrote a check for services to the donor which he says is lost and wants me to change it to a contribution. It was written about 6 months ago.

Matt · Post by **Matt** » Mon Dec 13, 2004 7:52 pm

According to the Church and Clergy Tax Guide, no charitable deduction is allowed for a contribution of services. That being the case, I would advise voiding the lost check in PowerChurch and then writing out a replacement check to the donor.

jeffkoke · Post by **jeffkoke** » Tue Dec 14, 2004 9:13 am

matt wrote:According to the Church and Clergy Tax Guide, no charitable deduction is allowed for a contribution of services. That being the case, I would advise voiding the lost check in PowerChurch and then writing out a replacement check to the donor.

Matt,

Correct me if I'm wrong here.

If a church member is paid (by the church) for services rendered. Can't s/he legally endorse the check back to the church as a bona-fide contribution?

Jeff

Matt · Post by **Matt** » Tue Dec 14, 2004 3:19 pm

Jeff,

Sure they could. And I would have no problem with that because the church's records would show that a check was paid (expense) and contribution income was received.

However, Deb sounded like the donor did not want to get a replacement check and then turn around and give it back to the church. Rather, it sounded like the donor wanted the church to do what amounts to an accounting adjustment.

Matt

jeffkoke · Post by **jeffkoke** » Tue Dec 14, 2004 10:13 pm

Aha! Gotcha.

Thanks

deb · Post by **deb** » Wed Dec 15, 2004 7:51 am

matt Posted: Mon Dec 13, 2004 7:52 pm Post subject:

--------------------------------------------------------------------------------

According to the Church and Clergy Tax Guide, no charitable deduction is allowed for a contribution of services. That being the case, I would advise voiding the lost check in PowerChurch and then writing out a replacement check to the donor.

Okay, I'll try one more time...
The check was written Feb 04 for a reimbursement for snow removal that this person payed to another person. He says he has lost the check and wants me to count it towards a contribution from him.
Can this be done or do I have to write him another check and have him write a check to the church...and then would I have to put a stop payment on the original check? (I'm getting dizzy)
Thanks again, Deb

jeffkoke · Post by **jeffkoke** » Wed Dec 15, 2004 8:12 am

deb wrote:Okay, I'll try one more time...
The check was written Feb 04 for a reimbursement for snow removal that this person payed to another person. He says he has lost the check and wants me to count it towards a contribution from him.

Can this be done or do I have to write him another check and have him write a check to the church...and then would I have to put a stop payment on the original check? (I'm getting dizzy)
Thanks again, Deb

If it were me, I'd do all of the above, except the dizzy part.

Stop payment and void the first check, re-write it and let the member either:
a. Endorse it back to the church or
b. Deposit it into his personal account and he can then write the church a contribution on his personal checking account.

Easy as 1,2,3!
Jeff

Randy B · Post by **Randy B** » Wed Dec 15, 2004 8:22 am

Another point is if the vendor is paid over $600, there is a 1099 issue. As stated earlier, donations of materials are deduction to donors but not donation of services.

tborgal · Post by **tborgal** » Thu Dec 16, 2004 6:41 am

Since the person receiving the reimbursement is not the one who performed the service Jeff's solution is appropriate. However Randy brings up a good point. If the service provider has recieved $600+ for services rendered to the church in 2004, including this reimbursement, it could appear that you are trying to hide something from the IRS. Because of this I do not recommend that any service provided should be paid through a third party. All services provided to the church should be paid directly to the vendor by the church. That way it can be properly tracked and 1099's can be issued if necessary.