Donated and Contributed Property: Recording and Tracking

Purpose

This document describes how to record and track property that has been donated or contributed to the Research Foundation of State University of New York (RF), or to a project director.

Background

All tangible personal property received by the RF needs to be accepted and recorded in the Grants Management module of the RF business system in a timely manner (see Gifts and Non-Cash Awards procedure). Acceptance of gifts and non-cash contributions must be in accordance with the RF Gifts, Contributions, and Fund-Raising Policy and Philanthropy, Gift Acceptance and Valuation Guidelines.

Recording Donated or Contributed Property

The SUNY Property Control System (PCS) depends on project director communication for recording donations or contributions of property. The operations manager or delegate in charge of the property control function should be informed of donations or contributions so that appropriate procedures for inventory control can be implemented. Benefits of proper reporting are the ability to insure the property and the ability to account for property depreciation and maintenance as facilities and administrative (F&A) costs. Section J13 of the U.S. Office of Management and Budget (OMB) Circular A-21 lists donations as a valid category of property for which F&A costs can be recovered. For procedures on recording donations or contributions in the SUNY PCS, see Adding Property Records to the Property Control System.

Approval of Donations or Contributions

For all donations or contributions to the RF, an approval process ensures compliance with Internal Revenue Service (IRS) regulations, assists donors in receiving a tax credit, and provides oversight of conditions that may be attached to donations. The RF approval process is set forth in the Gifts, Contributions, and Fund-Raising Policy.

IRS and Other Federal Regulations

If a donation or contribution is offered and a tax credit is requested by the donor, then IRS Form 8283 (Noncash Charitable Contributions) is to be completed to certify the donation or contribution. An independent written appraisal of the valuation of the asset must be performed and certified on IRS Form 8283. This form and IRS instructions for its use are available in the Property Management Forms resource area of EPSS: IRS Forms Related to Property Management.

The form must be forwarded to the finance office at RF central office, and is signed by an officer of the RF. The form is given to the donor to document receipt and to enable a tax credit. Copies of the certificate are maintained in the finance office.

When the certification is complete, the finance office at RF central office notifies the operations manager. The operations manager must notify the campus office responsible for the property control function, who enters the information into PCS. This is an internal control to ensure that all property donations or contributions for which a tax credit is given are recorded in PCS.

Donated or contributed assets in which the donor has claimed a tax credit must be tracked for 3 years. If the asset is sold or disposed of within 3 years, the IRS must be notified. For further IRS regulations related to donated or contributed property, refer to the Donated Property Disposition Procedure.

The American Jobs Creation Act of 2004 includes new provisions changing how allowable deductions for donations of vehicles are determined and new requirements for non-cash gifts. Beginning in 2005, the charitable deduction for the contribution of a vehicle (including automobiles, boats, and airplanes for which the claimed value exceeds $500) that is resold by the RF is limited to the gross proceeds received by the RF upon resale.The new law also imposes new substantiation requirements for contributions of vehicles for which the claimed value exceeds $500. A deduction is not allowed unless the taxpayer substantiates the contribution by means of a "contemporaneous written acknowledgment" from the RF stating the name and Social Security number (or taxpayer ID number) of the donor, the vehicle identification number, and a statement that the vehicle was sold by the charity in an arm's length transaction between unrelated parties. It must also show the gross proceeds from the sale and state that the donor's deduction cannot exceed that amount. The RF must provide the acknowledgment to the donor within 30 days of sale of the vehicle. Different rules apply if the RF uses the vehicle rather than selling it or materially improves the vehicle before sale. In those cases, the donors should be able to claim the fair market value of the vehicle as the amount of the charitable contribution, but in some cases the donor will need to obtain a qualified appraisal. For clarification on this paragraph, contact the RF office of philanthropy at central office.

Donated or Contributed Asset Valuation

Donated or contributed property should be recorded at the fair market value at the time of the donation. Real property (land and buildings) should have a written appraisal to obtain the fair market value. Personal property (equipment, vehicles, etc.) should also have an appraisal, or the value may be obtained via another reasonable, reliable, cost-beneficial method that will meet the criteria of OMB Circulars A-21 and A-110. For additional guidelines on property valuation, see Philanthropy, Gift Acceptance, and Valuation Guidelines.

If the donor is going to claim a tax credit for the donation or contribution, then an independent written appraisal is required. IRS Form 8283 (Noncash Charitable Contributions) must be completed by the donor. This form and IRS instructions for its use are available in the Property Management Forms resource area of EPSS: IRS Forms Related to Property Management.

If the donor does not seek a tax credit, an independent valuation of the cost is required for assets valued at $5,000 or more. The valuation can be accomplished various ways, such as from price listings in vendor catalogs, a price quote from a supplier, appraisal, or another appropriate method selected at the discretion of the operating location.

Change History

 

 

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