G5. Can our Charity give the donors something in return for their gifts?
Yes, a charity can give a token of appreciation. This token is called a “consideration” or "advantage.” Examples of advantages include pens, mugs, T-shirts, and books.
If your Charity gives a token of appreciation, the amount of the gift that appears on the official donation receipt may have to be reduced by the amount of the advantage. This is known as "split receipting”. A charity must determine the Fair Market Value of the advantage to the donor, regardless of the item’s actual cost to the charity.
Once the fair market value is determined, the charity will have to apply the de-minimis rule to determine if the advantage is “big” enough to be included in calculating the eligible amount on the receipt. If the fair market value of the advantage is minimal, the value of the donation does not have to be reduced.