Recent Hurricane Relief

Had a few members donate specifically for hurricane harvey (or other recent events). the previous clerk created an Other category specifically for Hurricane Harvey, but now the funds are just sitting there. Do I need to send a check in, or just recategorize the donation as general Humanitarian Aid without any specific destination being identified?

whitnahd wrote:Had a few members donate specifically for hurricane harvey (or other recent events). the previous clerk created an Other category specifically for Hurricane Harvey, but now the funds are just sitting there.

The options involve contacting the donors directly and discussing church policies regarding donations. Before doing that you should look at the donation slips to see how the donations were written and if they were properly recorded.

I can think of to two possible scenarios for the donation slips.

The first is the donors wrote in something like "Hurricane Harvey" in the "Humanitarian Aid" box and the amount in the box next to it. If this is the case, then, when contacting the donor, you would have to explain that we cannot designate how donations are to be used. It is not possible for someone donating through the church to designate what humanitarian aid program donation funds are to be used to support. The donor then needs to make a decision as to what donation category the funds are to be designated toward. The donor can identify any of the donation categories on the donation slip, including the general "Humanitarian Aid" category to allocate the funds toward. The total amount can be split in any manner to any of the categories as long as the total remains the same. The funds cannot be returned to the donor.

The original donation slip can be edited with the person making the changes initialing each change. A cleaner preferred method to correct the donation slip is to have the donor complete a new slip with the desired changes. The changes in categories can then be made to the original batch in MLS. Print the new batch record and file it along with the transmission report with the original donation batch paper work.

In the second scenario the donors wrote something like "Hurricane Harvey" in the "Other" category box and the amount in the box next to it. The "Other" category is not a donation to the church but rather a place to hold funds to be used for a specific purpose. Contributions to an "Other" category are not normally considered a charitable donation. The "Other" category is a pass through account where funds are stored until disbursed for the specific purpose. If you cannot determine how to get these funds to a responsible agency, entity, or person, then the funds should be returned to the donors. Another option for the donors is to recategorize the donation to any of the charitable categories as previously explained.

In the situation where you cannot disburse the funds for the intended purpose and a donor of funds marked in the "Other" category cannot be returned to the donor or they cannot be contacted to authorize recategorizing to a charitable category then the funds should be sent to church headquarters as excess "Other" category funds to the Corporation of the President. I personally would ask the bishop how he thinks the donor would have liked the funds to be handled. I suspect the donation would be recategorized as "Humanitarian Aid" or even possibly as tithing.

I'd make sure to resolve this before the end of the year. Normally, donations to "Other" are not tax-deductible. Unless they get recatagorized before the end of the year, they will not show up on the tax form printed in January.

this is exactly what I needed. sounds like I need to contact the member to see if they are OK directing the donation to the Humanitarian aid category.

I think the only way to reclassify an "Other" donation to a different category would be to write a check and re deposit it in the correct category, or request a transfer of funds form from Global (CHQTRS). I don't think you can do it from the Unit internally in MLS.

AAAuditor wrote:I think the only way to reclassify an "Other" donation to a different category would be to write a check and re deposit it in the correct category, or request a transfer of funds form from Global (CHQTRS). I don't think you can do it from the Unit internally in MLS.

There is no restriction on reclassifying donations (at least not for donations in the current year). Any restriction would prevent the clerk from correcting an entry error. Writing a check to make a transfer would not be a solution because then the donation would not be classified correctly for the tax statement. Adjusting donations can be done in LCR now too (although interestingly a clerk cannot adjust their own donations).

AAAuditor wrote:I think the only way to reclassify an "Other" donation to a different category would be to write a check and re deposit it in the correct category, or request a transfer of funds form from Global (CHQTRS). I don't think you can do it from the Unit internally in MLS.

That would be true of transfers. But that's not what's happening here. Both donations and checks can be reclassified.