Hi there, Jared. Let me shed some light regarding recording a donor payment of the invoices for the IRS.
When a donor pays an invoice they have received, this is deemed a donation or gift. The gift tax is imposed on transferring property from one person to another, where the recipient doesn't receive anything in return.
Moreover, please know that there are following things that the IRS doesn't consider as gifts. Here are the following:
- Contributions that do not exceed the annual exclusion limit for the specified calendar year.
- Expenses made for someone else's education or medical needs
- Donations are given to one's spouse.
- Contributions are directed to a political organization for its operational purposes.
Additionally, please know that for these payments to be subjected to reporting, they must exceed the $18,000 threshold.
For more information, you can check this article: Frequently asked questions on gift taxes.
Importantly, please know that it's best to coordinate with your account regarding the funds that don't pass through the charity. They have the specialized knowledge to manage these situations effectively and can provide accurate recommendations.
Furthermore, I have included these articles that will assist you in gaining a deeper understanding of reports and how to personalize them effectively.
You can always get back to this forum if you have other concerns regarding reporting a donor's payment to the IRS. I'll make sure to help you out anytime.
