Key Takeaways
Donation acknowledgment letters serve two critical functions: they satisfy IRS requirements that allow donors to claim tax deductions, and they strengthen the donor relationship by expressing genuine gratitude. Getting the letter wrong can cost your donors their deductions. Getting it right builds loyalty.
What a Donation Tax Letter Sample Must Cover
A donation tax letter sample -- also called a donor acknowledgment letter or charitable contribution receipt -- is the written record the IRS expects a 501(c)(3) organization to issue when it receives a contribution. The IRS does not publish a single official template, which is why nonprofits rely on a donation tax letter sample as a starting point and then customize it for each gift type.
A compliant sample must include five elements, regardless of the format you choose:
The three templates below cover the three situations every nonprofit will encounter: cash gifts, non-cash gifts, and quid pro quo (event) contributions. Use them as-is for small organizations, or as a baseline for legal review at larger ones.
IRS Requirements by Gift Amount
Under $250: No Letter Required (But Recommended)
The IRS does not require a written acknowledgment for gifts under $250 -- donors can use bank records or receipts. However, best practice is to acknowledge every gift. It is good stewardship and creates a paper trail.$250 and Above: Written Acknowledgment Required
For any single contribution of $250 or more, the donor must obtain a contemporaneous written acknowledgment from the nonprofit. Without it, the IRS will deny the deduction.The letter must include:
- Organization name
- Amount of cash contribution (or description of non-cash contribution)
- Statement that no goods or services were provided in exchange -- OR -- a description and good faith estimate of the value of goods or services provided
Quid Pro Quo Contributions Over $75
If the donor received goods or services in exchange for a contribution exceeding $75, the nonprofit must provide a written disclosure statement that:- Informs the donor that the deductible amount is limited to the amount exceeding the value of goods/services received
- Provides a good faith estimate of the value of goods/services
Template: Cash Donation Acknowledgment
> [Organization Name] > [Address] > [Date] > > Dear [Donor Name], > > Thank you for your generous contribution of $[amount] to [Organization Name], received on [date]. Your support makes our work possible. > > [1-2 sentences about what the gift supports or a brief impact statement] > > For your tax records: No goods or services were provided in exchange for this contribution. [Organization Name] is a 501(c)(3) tax-exempt organization. Our EIN is [number]. > > With gratitude, > [Signature] > [Name, Title]
Template: Non-Cash Donation Acknowledgment
> [Organization Name] > [Address] > [Date] > > Dear [Donor Name], > > Thank you for your generous donation of [description of items -- e.g., "10 boxes of office supplies" or "one 2022 Honda Civic"] to [Organization Name], received on [date]. > > For your tax records: No goods or services were provided in exchange for this contribution. [Organization Name] is a 501(c)(3) tax-exempt organization. Our EIN is [number]. > > Please note: [Organization Name] does not assign a monetary value to non-cash contributions. The determination of fair market value is the responsibility of the donor. > > With gratitude, > [Signature] > [Name, Title]
Critical: Do NOT include a dollar value for non-cash donations. Valuation is the donor's responsibility. See our in-kind donation guide for more on non-cash gift management.
Template: Event or Benefit Acknowledgment (Quid Pro Quo)
> [Organization Name] > [Address] > [Date] > > Dear [Donor Name], > > Thank you for purchasing [a ticket to / a table at] our [Event Name] on [date] for $[total amount paid]. > > In exchange for your payment, you received [description of goods/services -- e.g., "dinner and entertainment"]. The estimated fair market value of the goods and services provided was $[FMV amount]. > > The tax-deductible portion of your payment is $[total paid minus FMV]. [Organization Name] is a 501(c)(3) tax-exempt organization. Our EIN is [number]. > > With gratitude, > [Signature] > [Name, Title]
Best Practices
Timing
- Send acknowledgment within 48 hours of receiving the gift
- For year-end gifts, send acknowledgment by January 31 of the following year at latest
- Annual giving statements (summarizing all gifts for the year) should be mailed by January 31
Personalization
- Use the donor's name (not "Dear Friend" or "Dear Donor")
- Reference the specific gift and date
- Include a brief, genuine impact statement
- Sign the letter (printed signature at minimum)
What NOT to Include
- Do NOT value non-cash donations
- Do NOT provide tax advice ("this donation is tax deductible to the full extent of the law" is unnecessary and potentially misleading)
- Do NOT include a solicitation in the acknowledgment letter (it cheapens the gratitude)
Tangible Takeaway
Create three letter templates this week: (1) Standard cash gift acknowledgment. (2) Non-cash gift acknowledgment (with the explicit statement that valuation is the donor's responsibility). (3) Event/benefit acknowledgment with quid pro quo disclosure. Save these as templates in your CRM or document system. Ensure every gift of $250+ receives the appropriate letter within 48 hours. This protects your donors' deductions and demonstrates organizational professionalism.
Frequently Asked Questions
Can we email donation acknowledgments? Yes. The IRS accepts electronic acknowledgments. However, for major gifts, a printed and signed letter feels more personal.
Do we need to send one letter per gift or can we send an annual summary? Either works for IRS purposes, as long as the annual summary is received before the donor files their tax return. Many organizations send both: immediate acknowledgment for each gift plus an annual summary in January.
What if we forgot to send a letter? Send it immediately. The donor needs it before filing their return. For prior-year gifts, send a letter as soon as possible with an apology for the delay.
Do we need to acknowledge gifts from foundations? Yes. Foundations also need documentation for their records, and it is professional practice regardless of tax requirements.
Can we include a reply envelope or solicitation? Technically allowed, but best practice is to keep the acknowledgment focused on gratitude. If you must include a solicitation element, make it subtle and secondary.
What about gifts of stock or securities? Acknowledge by describing the securities donated (number of shares and name of stock) and the date received. Do NOT state the value -- the value for tax purposes is the mean of the high and low on the date of the gift.
About the Author
Drew Giddings is the Founder and Principal Consultant of Giddings Consulting Group, with more than 30 years of experience in fund development and donor engagement.
Contact Giddings Consulting Group to discuss fund development, donor stewardship, or organizational planning for your nonprofit.
About the Author
Drew Giddings
Founder & Principal Consultant
Drew Giddings brings more than two decades of experience working with mission-driven organizations to strengthen their capacity for equity and community impact. His work focuses on helping nonprofits build sustainable strategies that center community voice and create lasting change.
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