Standard Operating Procedures for Acceptance of Gifts

Standard Operating Procedures for Acceptance of Gifts

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PURPOSE

NC State University and its associated entities seek and value philanthropy to help support, maintain, and grow its dynamic faculty; recruit and retain talented students; and support and enrich its libraries, museums, and research capacity. Any intended gift and any restrictions on its use should be acceptable and support the mission of the University and its associated entities.

NC State University and its associated entities solicit, accept, distribute, and manage private gifts that benefit the functions of the University. University Advancement is charged with overseeing the fundraising activities in concert with the associated entities on common goals to support NC State University initiatives. Advancement Services oversees data management to ensure the accuracy and completeness of the gift records.

Advancement Services is authorized to accept all gifts for the benefit of the University in the form of cash, checks, electronic funds transfers, credit or debit card transactions, gift in kinds and securities. This operating procedure serves as the operating procedures necessary and allowed under section 6 of POL03.00.01, Coordination of Fundraising Activates and Acceptance of Private Donations (Gifts).

GIFT ACCEPTANCE

Below, the policies and procedures for accepting gifts are listed according to each type of gift. Please click the underlined hyperlinks within the red box in order to navigate to the section of your choice.

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Cash Gifts

All gifts to the University or a University Associated Entity, with the exception of the Wolfpack Club, are processed through Gifts & Records Management (GRM) in the Office of Advancement Services.

Cash gifts include cash and cash equivalencies including checks, credit cards, EFT, wire transfers, and payroll deduction. In order for cash gifts to be accredited to a University Associated Entity project, the gift must have been solicited in the name of the University Associated Entity. Additionally, checks must be made payable to the entity in which the gift is to be deposited or have supporting documentation from the donor designating funds. All other cash gifts will be deposited according to the approved guidelines adopted by Advancement Services and Foundations Accounting & Investments (FAI) in the NCSU University Check Guidelines.

Cash gifts may be delivered in person, by mail, by Electronic Funds Transfer (EFT), or by wire transfer. Cash gifts are complete on the date the cash is provided physically to a representative of the University or a University Associated Entity.

• For credit card gifts, the name on the credit card must match the name of the person making the gift.
• Checks will be deposited to the entity named as the Payee on the check. Checks made payable directly to a University Associated Entity will be deposited according to the approved guidelines adopted by Advancement Services and FAI in the NCSU University Check Guidelines.
• For Wire/ACH transfers the receiving development office must alert FAI and GRM as wired funds come to its attention. GRM will alert the receiving development office working with the donor for the date funds are received. The development office that receives the wired funds must prepare the gift transmittal form and submit it to GRM along with written confirmation from FAI. GRM will record the gift in Advance once receiving the transmittal.
• Gifts of foreign currency will be valued at the U.S. dollar equivalent on the date the gift is received. Foundations Accounting & Investments (FAI) is responsible for currency conversion transactions, and for informing either the receiving development office preparing the gift transmittal or GRM of the U.S. dollar amount of the gift. The transaction fees resulting from converting foreign currency to U.S. dollars will be charged against the gross proceeds of the gift.
• University payroll deduction can be established, modified and ended through Advancement Services’ NC State Employee Payroll Portal. Payroll deduction can also be managed via paper form. Contact GRM for assistance in starting or stopping a payroll deduction.
• Bank Draft can be established by completing the Bank Draft / EFT Donor Authorization form and submitting to GRM. All bank drafts are drafted on or around the 15th of each month. Minimum amount is $10.00. Contact GRM to start or stop a bank draft.
• Recurring Credit Card gifts are processed and maintained via the online giving form. Credit card numbers must never be maintained in any NC State system or office.
• An Individual Retirement Account (IRA) charitable rollover can be given through the Office of Gift Planning (OGP). Instruct the donor to initiate this type gift through their IRA plan administrator to NC State or University Associated Entity. Please note that IRA charitable rollover gifts do not qualify for a charitable deduction. An acknowledgment letter will be generated but no gift receipt will be issued.

The date of gift for cash gifts listed in our gift records will be the date the gift is processed by GRM. (Note: The gift date that a donor can claim for tax purposes may be earlier than the date the gift is processed by GRM. The donor’s gift date for tax purposes will depend upon how the gift was delivered, and must be determined ultimately by the donor in consultation with his or her tax advisor.)

For gifts that arrive after GRM closes at the end of business on December 31st, the tax receipt will include the following messaging to be included on all tax receipts mailed in January each year.

Please Note: The process date on your gift receipt reflects when we processed your gift, and does not imply the date your gift was made. Please consult with your tax advisor for IRS requirements regarding deductibility of this gift for your specified tax year. Should you have any questions concerning this matter please contact us at giftsandrecords@ncsu.edu or 919-515-7827.

Procedure to process cash gifts

1. Deposit. Gifts to the University are deposited by departments receiving them through GRM (for gifts to a University Associated Entity) or through the Cashier’s Office (for gifts to the University).
   • Gifts from estates and trusts should be routed to the Office of Gift Planning for deposit so that they may be connected to the appropriate documentation.
2. Transmittal. The development office that receives the gift is responsible for preparing the gift transmittal form and submitting it to GRM within 24 hours of receipt along with either the original or copies of all supporting documentation for the gift. If the gift is a payment toward a pledge, the receiving development office filing the gift transmittal form should note that the payment is a pledge payment.
3. Recognition. Outright gifts of cash are credited to the donor’s giving record at actual cash value. The donor’s giving record will receive legal (hard) credit for the value of the gift. Recognition (soft) credit is given automatically to the spouse/partner. It is not always obvious who (other than spouse) should receive recognition (soft) credit, such as a family foundation, a living trust, community foundation, or donor advised fund. Therefore, the receiving development department must inform GRM via the gift transmittal form when such credit should be given. If GRM receives a check that includes the names of both the donor and his or her spouse/partner, legal (hard) credit is given to the individual who signed the check. Recognition (soft) credit will also be given if the gift is made by a business entity, provided the donor is the major owner or one of the major owners of the business. This relationship must be brought to the attention of GRM.
4. Receipt. A receipt is issued for the actual cash value of the gift, with the exception of IRA rollover gifts, in compliance with IRS Publication 1771. An acknowledgement will be mailed for IRA rollover gifts with no charitable deduction. GRM will receipt the gift on the date the gift transmittal form is processed by GRM. Normally, receipts will be mailed to donors within two business days after processing. Donors should consult with a tax professional with any tax deductibility questions.

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Pledges

Pledges should be recorded in accordance with relevant Financial Accounting Standards Board (FASB) or Governmental Accounting Standards Board (GASB) rules, Council for Advancement and Support of Education (CASE) Guidelines, and the pledge rules and procedures prescribed by Advancement Services.

Pledge commitments must be written, signed by the donors, and include the amount of the pledge, the pledge period, the date of the first payment, and the frequency of payments. In addition, the written pledge must contain a statement of the gift’s designation, purpose, and any restrictions. Pledges are established for a payment period of five years or less from signing. Any exceptions must be approved by the Vice Chancellor for University Advancement.

A donor’s pledge cannot be paid in the gift system with a payment by a third party such as a community foundation, donor-advised fund, or a matching gift.

Pledge payments made with a gift of an asset that cannot be easily converted to cash—such as real estate or closely-held securities— can pay on a pledge but may require additional review before recording.

A donor may make one of the following types of pledges:

• Unconditional pledges are a promise to give that depends only on the passage of time or demand by the promise of performance.
• Conditional pledges are a promise contingent upon a University event occurring, goal being attained, or another specific requirement being met by the University before a contribution will be made. Pledges contingent to a donor event occurring, goal being attained, or specific requirement being met will not be recorded. Conditional pledges are not counted in fundraising totals until the condition is fulfilled. Conditional pledges should only be accepted for projects if approved by the Vice Chancellor for University Advancement.

Procedure to process unconditional and conditional pledges

1. Pledge transmittal. The receiving development office working with the donor should submit the completed pledge transmittal form to Gifts & Records Management (GRM). GRM will record the pledge in Advance.
2. Pledge reminder. GRM is responsible for sending the pledge reminders to the donor unless the development office working with the donor requests to send the reminder. Pledge reminders are generated thirty days before the scheduled pledge payment is due and thirty days after the scheduled pledge payment date. Pledges are recorded in the advancement database with a frequency of a monthly, quarterly, yearly, or custom schedule. Additional reminders may occur in accordance to the Pledge Management Plan.
3. Recognition. The donor’s giving record will receive legal (hard) credit for the value of the pledge payment. Recognition (soft) credit is given automatically to the spouse/partner. It is not always obvious who (other than spouse) should receive recognition (soft) credit, such as a family foundation, a living trust, community foundation, or donor advised fund. Therefore, GRM must be informed via the gift transmittal form when such credit should be given. Recognition (soft) credit will also be given if the gift is made by a business entity, provided the donor is the major owner or one of the major owners of the business. This relationship must be brought to the attention of GRM.
4. Receipt. GRM will receipt the gift on the date the gift transmittal form is processed by GRM. Normally, receipts will be mailed to donors within two business days after processing.

Pledge monitoring and reminders

Development officers are responsible for pledge fulfillment. When a pledge amount has been received by a third party, the development officer should notify GRM to reduce the pledge by the same amount manually. Please note that all recorded unconditional pledges are subject to auditor confirmation. Pledges selected for confirmation will be supplied to development officers for review prior to auditors contacting donor.

The Pledge Management Plan outlines the process for managing the process for pledge reminder distribution and fulfillment of delinquent pledges.

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Publicly traded securities, mutual funds, and dividend reinvestment accounts

Gifts & Records Management (GRM) is responsible for processing gifts of securities to benefit NC State or a University Associated Entity, except the Student Aid Association (Wolfpack Club.) Gifts of securities benefiting the Student Aid Association (Wolfpack Club) must be delivered directly to the Wolfpack Club’s brokerage account and not a brokerage account managed by FAI. Securities intended for the Wolfpack Club delivered to another foundation’s brokerage account risk being returned.

Marketable stocks, bonds, or other securities traded on national exchanges are acceptable as outright gifts, payments towards pledge commitments, and to fund various deferred gifts such as charitable remainder trusts and charitable gift annuities.

Generally, securities are sold within 24 hours after they are received. The internally recorded value of the gift is based on the average of the high and low selling price for the security on the date of gift. The internal valuation date of gift on a securities transaction depends on the type of delivery used. The internally recorded value of the gift should not be construed as the charitable value of the gift. Donor should determine this value with consult from a tax professional.

The security maybe mailed, delivered personally to a representative of the University or a University Associated Entity, or transferred electronically (via the DTC system) from the donor’s brokerage account to the brokerage account for the University or a University Associated Entity. Additionally, the donor may have shares re-issued by the transfer agent in the name of NC State University or one of the University Associated Entities.

Dividend reinvestment accounts (DRIP) are another way that a donor may make a gift of securities. A DRIP account holds stock that is acquired because the donor has his or her dividends reinvested in order to purchase additional shares. This type of account usually holds fractional as well as full shares.

Gifts of mutual fund shares are also acceptable; however, transfers of this type take longer to complete. Many mutual funds are not DTC transferable. Each company sets its own requirements regarding transferring these shares to a charitable organization.

Procedure to process gifts of securities

1. Notification/Approval. The development officer or staff person should notify Gifts and Records Management (GRM) as soon as they know a stock transfer is going to be made. The development officer, in consultation with GRM, will provide electronic transfer instructions for the University or any of the University Associated Entities to donors or their advisors. If paper certificates will be used, GRM will help the donor prepare the required stock power and the donor letter of instruction. These documents require the donor to have his or her signature guaranteed at a commercial bank or a brokerage account before they are returned to the GRM to complete the gift transaction.
   The GRM Staff works with Foundations Accounting and Investments (FAI) to authorize the sale of the stock when it has been received. Required information includes the name of the donor, the number of shares, the name of the security being transferred, and the account name and number to which the proceeds should be deposited. Stock information can be shared via email at stockgifts@ncsu.edu.
2. Transmittal. GRM prepares all security transmittal documents. GRM informs the appropriate University entity that a security gift is being made and sends copies of all paperwork to the appropriate development office.
3. Recognition. The donor’s giving record will receive legal (hard) credit for the value calculated for internal purposes. Any difference between the average price and the actual selling price will be treated as a gain or loss to the fund when the gift is deposited and posted to the accounting system by FAI. When securities are used to make a payment against a pledge, the pledge balance will be reduced by the amount of the legal (hard) credit. Recognition (soft) credit is given automatically to the spouse/partner.

4. Receipt. A receipt will be issued to the donor reflecting the internal value of the shares on the date of the gift, as well as a description of the securities received. The receipt will reflect the average of the high/low sales price of the securities on the date of gift. GRM will receipt the gift on the date the gift transmittal form is processed by GRM. Normally, receipts will be mailed to donors within two business days after processing. The internally recorded value of the shares should not be used as a charitable value by the donor.

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Cryptocurrency

Gifts of cryptocurrency (convertible virtual currency) will be evaluated by the Gift Acceptance Committee on a case-by-case basis. The following applies to gifts of cryptocurrency:

1. Any gifts of cryptocurrency to be accepted will be received and converted to US Dollars via a third-party relationship such as Fidelity Charitable, or similar.
2. Because of the volatility of the value of cryptocurrencies, unlike gifts of marketable securities, the internal gift value recorded in the advancement CRM and used to meet endowment minimums and naming opportunity minimums will be the amount in US Dollars after conversion, not the value at the time of transfer from donor.
3. Gifts of cryptocurrency made anonymously (not confidential) will not be accepted.
4. All gifts of cryptocurrency are considered irrevocable upon conversion to US Dollars and may not be refunded.
5. Encourage donors to consult with a tax advisor prior to making a gift of cryptocurrency.  

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Interests in mineral rights

Gifts of interests in mineral rights will be evaluated for acceptance by the Gift Acceptance Committee on a case-by-case basis. The following applies to gifts of interests in mineral rights:

• Only non-working interests will be accepted (working interests will not be accepted)
• The internal gift value of current gifts of interests in mineral rights will be determined by the Gift Acceptance Committee
• Bequest gifts of interests in mineral rights are recorded at $1.00

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Non-Standard & Complex Assets Gifts

Under certain circumstances, the University or a University Associated Entity will accept gifts of securities that are not traded on a public stock exchange or that have restrictions and other complex assets. These might include:

•  Restricted stock
•  C Corporation stock
•  S Corporation stock
•  Membership Interests in Limited Liability Companies
•  Limited Partner Interests in Limited Partnerships

These gifts must be coordinated with Office of Gift Planning (OGP) and Advancement Services. These gifts will be reviewed by the Gift Acceptance Committee (GAC) and a recommendation will be made to the Vice Chancellor for University Advancement and Vice Chancellor for Finance and Administration.

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Employer-sponsored matching gifts

A matching gift may be received from a company or a company-funded foundation that matches a gift given to the University or a University Associated Entity. Matching gifts designated to Wolfpack Club are not processed by GRM.

When the original gift being matched is a stock gift, the value that will be matched is the internally calculated value as described above, and not the net proceeds from the sale. Under certain circumstances, a matching gift claim can be entered for a deferred gift. This is an exception to the rule that the matching funds must be deposited into the same account as the original gift. GRM staff will ensure the gift is deposited properly into an appropriate account. This generally only happens when a company has allowed a matching gift to be made as long as it goes to an endowment or specific fund and is not added to the deferred gift.

Procedure to process matching gifts

1. Deposit. Matching Gifts to the University are deposited through GRM (for gifts to a University Associated Entity) or through the Cashier’s Office (for gifts to the University).
2. Transmittal. The development officer or staff member submits the matching gift form along with the original gift transmittal form to GRM for processing. GRM is solely responsible for processing all matching gift claims (except Wolfpack Club.). GRM will record the matching gift in the advancement database. Potential matching gifts cannot be entered as a part of a pledge the donor makes since those are not funds the donor has control of or is entitled irrevocably to receive.
3. Recognition. Matching gifts must be credited to the same account(s) as the original gift unless restricted by the matching company. The matching company receives legal (hard) credit for the matching gift. The original donor will receive recognition credit toward university giving societies.
4. Receipt. GRM will receipt matching gifts only when requested by company. Receipts will be mailed to donors within two business days after processing.

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Donor Advised Funds and Community Foundations

Donor Advised Funds (DAF) and Community Foundations (CF) are recognized as stand-alone 501(c)(3) tax- exempt charitable organizations.

A donor may recommend that a donor advised fund or a community foundation make a gift to NC State or one of the related foundations from funds the donor has given to the DAF or CF. A gift from a DAF or CF cannot directly pay on a pledge from the donor.

When a donor recommends a grant be made from one of these entities, no tax receipt will be issued to the original donor; he or she will receive his or her income tax deduction from the DAF or CF.

Donors will receive a tax receipt from the administering charitable organization at the time of donations into the fund; no tax receipts will be issued as grants are recommended and disbursed. Procedure to process DAF or CF gifts

1. Transmittal. The development officer or staff member sends the gift of DAF or CF via the gift transmittal form to Gifts & Records Management (GRM) for processing. GRM will record the gift in the advancement database.
2. Recognition. The donor’s giving record will receive recognition (soft) credit with the value of the gift and it will be noted that the gift was made by the DAF/CF. Recognition (soft) credit is also given to the spouse/partner. It is not always obvious who should receive recognition (soft) credit for a DAF/CF gift. Therefore, GRM must be informed via the gift transmittal form when such credit should be given.
3. Receipt. GRM will receipt the gift on the date the gift transmittal form is processed by GRM. Normally, receipts will be mailed to the DAF/CF within two business days after processing.

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Sponsorships

Sponsorships are payments by an individual or entity in a trade or business in which there is no arrangement or expectation that the person will receive any substantial return. Sponsorships are typically encouraged for underwriting events. Simply calling something a sponsorship does not necessarily mean the sponsor receives something of value in exchange. Often, sponsors are merely seeking name recognition. However, standard quid pro quo benefits such as receiving a table or certain number of tickets to the event may be issued in return for sponsorships.

Sponsorships are generally considered gifts unless the sponsor receives something of value as part of the sponsorship, such as meals or event tickets. In these cases, the value of the items received must be subtracted from the sponsorship amount. For example, if a company sponsors an event and pays $1,000, and in exchange receives four free meals, valued at $25 each, then $900 would be treated as a gift, and $100 would be treated as Other Income.

In terms of recognition, sponsors may receive the following recognition:

• Sponsor’s location, phone number, and website
• Value-neutral descriptions, including displays or visual depictions of the sponsor’s product line or services
• Displays of brand or trade names and provide or service listings
• Logos or slogans that are an established part of the sponsor’s identity
• Display or distribution (free or at cost) of the sponsor’s product at the sponsored event

Sponsors may not receive the following recognition:

• Qualitative or comparative language
• Price information or other indicators of savings or value
• Endorsement or inducement to purchase, sell, or use the sponsor’s service, facility, or product
• Other Advertising messages (competitive pricing, etc.)

The University established the Office of Strategic Brand Management within University Advancement in 2019. This office should be included in reviewing and approving more complex or university-wide sponsorships.

Procedure to process sponsorships

1. Notification/Confirmation. Notify Gifts & Records Management (GRM) and Foundation Accounting & Investments (FAI) that your department is seeking to secure sponsorship for an event that will be deposited into a ledger 6 project. Prior to finalizing the sponsorship, provide as much detail as possible to GRM and FAI. If the sponsorship will be deposited into a ledger 7 project, the Cost Analysis Office should approve prior to solicitation.
2. Transmittal. Sponsorships can be deposited as a gift into a foundation fund (ledger 6 project) if the event is marketed clearly as a foundation event and the check is made payable to the foundation. If the event is not marketed clearly as a foundation activity, then the gift (and any related other income portion) would still be processed as a gift, but the proceeds must go into a University fund (ledger 7 project).
3. Recognition. The donor’s giving record will receive legal (hard) credit for the value of the gift. It is not always obvious who should receive recognition (soft) credit. Therefore, the department must inform GRM via the gift transmittal form when such credit should be given. Recognition (soft) credit will also be given if the gift is made by a business entity, provided the donor is the owner or one of the major owners of the business. This relationship must be brought to the attention of GRM.
4. Receipt. GRM will receipt the gift on the date the gift transmittal form is processed by GRM. Normally, receipts will be mailed to donors within two business days after processing.

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Auctions and raffles

North Carolina law limits the number of raffles a state agency or non-profit may conduct each calendar year. The Vice Chancellor for University Advancement should approve all raffles to ensure compliance. Purchase of a raffle ticket is not a gift under Internal Revenue Service (IRS) regulations and no gift credit or gift receipt will be issued. See the Foundations Accounting & Investments (FAI) website regarding taxation issues related to raffle winnings.

Items donated for sale at an auction are not considered for a related use (to the University’s educational purpose) according to the IRS. Auction donors must be made aware in advance that the receipt will list the item donated, but no value for the item. At the auction, the fair market value must be indicated clearly in the information posted about the auction item. See the charity auction guidelines for more information.

Seek approval from Gifts & Records Management (GRM) and Foundation Accounting & Investments (FAI) before promoting or accepting gift-in-kinds for an auction.

Procedure to process auctions and raffles

1. Notification/Confirmation. Seek approval from Gifts & Records Management (GRM) and Foundation Accounting & Investments (FAI) that your department is interested in hosting an auction or raffle that will be deposited into a ledger 6 project. Prior to finalizing the auction or raffle, provide as much detail as possible to GRM and FAI. If the auction or raffle will be deposited into a ledger 7 project, the Cost Analysis Office should approve prior to solicitation.
2. Transmittal. For donations of items for auction or raffle, the description of the donated items should be submitted to Gifts & Records Management (GRM) on the BA-151 notification of gift transmittal form. For donations during an auction or raffle, a receipt may be issued only if the amount paid exceeded fair market value as known by the auctioneer and the donor. The fair market value must be sent with the Other Income sheet and the check/cash to FAI. If the amount paid exceeds known fair market value, GRM will record the gift in the advancement database. Items not sold will not receive any gift credit.
3. Recognition. The donor’s giving record will receive legal (hard) credit for the fair market value or the appraised value of the item, provided the item does not represent a service or partial interest. Partial interest contributions, such as temporary right to use property, are contributions of less than the entire interest in that property and are not deductible as charitable contributions (see the IRS Publication 526 section on partial interest in property). Recognition (soft) credit is given automatically to the spouse/partner. No recognition (soft) credit is provided for service or partial interest gifts.
4. Receipt. Receipts for donated raffle and auction items will reflect the donated item, but no value or price for the item. Receipts to a purchaser of an auction item can only be issued if the price paid by the successful bidder exceeds the listed fair market value of the item. The amount of the receipt will be the difference paid above the fair market value of the item. GRM will receipt the gift on the date the gift transmittal form is processed by GRM. Normally, receipts will be mailed to donors within two business days after processing.

Receipts for gift-in-kind items donated to be auctioned will only be issued after the auction has been completed and the item donated sold. If the item could not be auctioned, the item should be returned to donor and no receipt will be issued.

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Gifts of tangible and intangible personal property

Gifts of tangible property include, but are not limited to, books, works of art, manuscripts or archival materials, automobiles, films, video tapes, boats or sporting equipment, computer equipment, furniture, animals, office equipment, machinery, and lab equipment. Gifts of intangible personal property include, but are not limited to, computer software, patents, and copyrights. The deduction allowable for these types of gifts depends on how long the donor has owned the property, whether the donor has created the property, and whether it is related to the charitable purpose of the University.

NC State or one of the University Associated Entities can accept a gift of personal property and Gifts & Records Management (GRM) may issue a receipt if it is related or unrelated to the charitable purpose of the University or one of the University Associated Entities. Full transfer of ownership must be completed before a contribution is recorded or acknowledged. Generally, a gift of personal property is made to the University and not to a University Associated Entity. Gifts of software and animals are generally considered to be gifts to the University and not to a University Associated Entity. Gifts of software/software licenses need to be approved by the Gift Acceptance Committee before acceptance due to the nuanced IRS guidelines.

If the associated costs of maintaining that property exceed $1,000 per year, the unit/fundraiser must secure written approval from their dean or director or the Vice Chancellor for University Advancement before accepting the gift. The approving party signs the BA-151.

Whether the gift is related or unrelated to the charitable purpose of the University or one of the University Associated Entities can affect the allowable charitable deduction a donor may be permitted to claim under Internal Revenue Service (IRS) regulations. For example, gifts of artwork to the Gregg Museum of Art and Design are for a related use as would be lab equipment given to the Chemical Engineering Department. Items donated for an auction are not related to the University’s educational mission. If the property is a work of art that was created by the donor or something the donor has held for less than 366 days, he or she should be advised to check with his or her own tax advisor on the potential deductibility of the gift before the gift is accepted. It is the responsibility of the donor to determine the value of a gift of personal property for his or her tax purposes. A University employee should never value personal property for a donor.

Acceptance of gift-in-kind items to be used in an auction should only be accepted after the auction has been approved by Gifts & Records Management (GRM) and Foundation Accounting & Investments (FAI).

Acceptance of a gift-in-kind item unrelated to the charitable purpose of the University or University Associated Entities must be approved by the Gift Acceptance Committee prior to acceptance. This includes items that are accepted to be sold for proceeds. In this instance, the donor’s deduction may be limited to their cost basis, not the appraised value of the item. Gifts accepted to liquidate for cash immediately need a minimum value of $25,000.

Gifts-in-kind of services include, but are not limited to, such activities as printing of materials, appraisals, and design work, for example. These services provide valuable support to the University or University Associated Entities. The contribution of services, no matter how valuable to NC State University, is not tax deductible according to the IRS. Therefore, no legal (hard) credit or recognition (soft) credit is recorded in the advancement database for such gifts.

Gifts of patents are highly technical in nature, and the development officer should first contact Gifts & Records Management (GRM) and Foundation Accounting & Investments (FAI) to determine how these gifts may be accepted by NC State. Patent donations are recorded at $1. Gifts made in support of the patent (toward the costs associated with holding the patent or additional research and development, for example) are legal (hard) credited at face value, and a receipt will be issued for the amount donated.

The date of gift for gifts of personal property will be either the date the property’s ownership is assigned completely to the University via a deed of gift, even if physical possession will take place later, or an employee of the University or a representative of a University Associated Entity takes possession of the property.

Procedure to process gifts of personal property

1. Appraisal. The value of the gift is to be provided by the donor and should be documented with an appraisal, sales receipt, or other independent documentation. A qualified appraisal is the preferred documentation, and will be required by the Internal Revenue Service (IRS) if the donor intends to claim an income tax charitable deduction greater than $5,000. The appraisal would need to be completed no earlier than 60 days before the date of gift by a qualified appraiser in accordance with IRS guidelines. The appraisal and any associated costs are the responsibility of the donor. In those circumstances where the donor is unable or unwilling to supply documentation of valuation, the development officer may submit the best available documentation from a third party source, such as price lists, thrift value, or other evidence of fair market value. As a last resort, an unofficial valuation by qualified University personnel or verified market comparable will be considered for purposes of determining internal gift recognition amount. Under no circumstances shall the opinion of an employee of the University or University Associated Entity be used to establish valuation for the donors use to claim an income tax charitable deduction.
2. Transmittal. Gifts of personal property are reported on a BA-151 form that must be filed with Gifts and Records Management (GRM) along with all supporting documentation including description of donated item and any appraisal or valuation documents.
3. IRS forms. IRS Form 8283 may be required for the donor to substantiate a charitable deduction for any non-cash gift on his or her personal income tax return. The preparation of Form 8283 is the responsibility of the donor or his or her tax advisor. Forward the completed Form 8283 (both pages), bearing the appraiser’s original signature, plus a copy of the appraisal or other substantiating documentation to OGP. OGP will coordinate signatures from the appropriate Officer of the University.
4. Review. The Capital Asset Accounting (CAMS) Coordinator in the Controller’s Office will review the BA- 151 and supporting documentation for the asset gifted, and will determine what is recorded in the University accounting system as inventory so that it will be covered by University insurance.
5. Recognition. The donor’s giving record will receive legal (hard) credit with the estimated fair market value of the item. Recognition (soft) credit is given automatically to the spouse/partner. It is not always obvious who (other than spouse) should receive recognition (soft) credit, such as a family foundation, a living trust, community foundation, or donor advised fund. Therefore, GRM must be informed via the gift transmittal form when such credit should be given. Recognition (soft) credit will also be given if the gift is made by a business entity, provided the donor is the major owner or one of the major owners of the business. This relationship must be brought to the attention of GRM.
6. Receipt. The receipt issued to the donor for a gift of personal property will describe the property received but will not show a value for the property. GRM will receipt the gift on the date the gift transmittal form is processed by GRM. Normally, receipts will be mailed to donors within two business days after processing.

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Gifts of real property

Gifts of real property may include full and/or fractional interests in improved and unimproved land, residences, condominiums, apartment buildings, rental property, commercial property, woodlands, and farms. Gifts of real property can be valuable assets for furthering the missions of NC State by enhancing the delivery of high quality teaching, research, and extension and engagement activities and programs. However, gifts of real property can create financial, legal, and logistical obligations for the University, particularly if the gift is provided with the expectation or condition that the University retains the gift for extended periods, for specific purposes, in a specific condition, or that it be disposed of under particular terms.

Note: The University and University Associated Entities do not accept gifts of timeshares or cemetery plots.

Proposal

All proposals for the acceptance of a gift of real property must be in writing and contain the following:

• Description of gift and specific criteria supporting acceptance
• Identity of donee – the State of North Carolina, Endowment Fund, or a UAE
• Whether property is to be sold or retained for programmatic use
  • If retained for programmatic use, a Land Use Plan must be attached to the proposal
  • If to be sold, source of funds to pay carrying costs until property is sold

The proposal must be approved by the applicable department head/program director and college dean/vice-chancellor and sent to RED and OGP.

RED shall evaluate the proposal according to the real estate acceptance review process (described at the end of this section) and make a recommendation to the VC of UA and the VC of FA. OGC is available for consultation on potential legal issues pertaining to the property. Upon approval of the VC of UA and the VC of FA, the gift of real property may be accepted. Acceptance of any real property to be owned by the Endowment Fund, the State of North Carolina, or a UAE requires subsequent approval by the appropriate entities.

Any gift of real estate must meet the criteria below by benefiting the University in at least one of the following ways: real property to be sold, programmatic purpose, or other institutional purposes. The Chancellor may make exceptions to the criteria set forth below.

1. Real property to be sold. Gifts of real property may be accepted for immediate sale or short-term retention in anticipation of sale for purposes of providing funds to support other University objectives. Proposals to accept gifts of real property to be sold for proceeds to support other University objectives must include the following:
   • A plan for sale and immediate management of the property
   • The identification of a source of funds to cover expenses incurred while holding the property until it is sold
   • A description of the anticipated net proceeds to be realized from the sale and the proposed use of such proceeds
   • The identification of the specific program(s) that the proceeds will benefit
     •  Recommended Minimum Value. Gifts of real property to be sold are recommended to have a minimum appraised value of $100,000. In lieu of an appraisal, county real estate tax values may be used to determine estimated value of a proposed gift for purposes of an Initial Review (see Procedures below). Proposed gifts of real property to be sold with appraised values of less than $100,000 will be reviewed by OGP and RED but are not encouraged due to the monetary costs and potential financial risks to the UAE that are implicit with the acceptance of gifts of real property.

2. Programmatic purpose. Gifts of real property that are advantageous programmatically must be accompanied by endowed funds, a revenue generating mechanism, or some other explicit financial plan to support the maintenance of the gift and the fulfillment of the programmatic purpose. Gifts of real property may be accepted to advance the programs of the University (teaching, research, and extension and engagement) as long-term sources of income to support programs or the location for specific programs have been identified
   • Generation of income for programs. Gifts of real property may be accepted that generate income to support programs financially (e.g., facility rental, contract farming, timber management). The University must also have a programmatic interest in the property to accept such income producing gifts (e.g., a working forest that can demonstrate leading-edge forest practices may also produce income to support those programs through planting, culture, and harvesting of trees; a site at which students serve internships required by their academic program in which public programs are held may also produce income to support those programs through admission prices or rental for special events). Proposals to accept gifts of real property that may generate income to support programs must include the following:
     • The intended use of the gift
     • The relation of the gift to a programmatic interest of the University
     • A logistical plan for managing the property
     • The expected annual net returns to the University over the expected retention period of the property
     • The identification of a source of funds to cover expenses incurred while holding the property until it generates income
     • Specific criteria to be used over time to evaluate the proposed business plan to enable a judgment as to whether the property should be retained, used for another purpose, sold, or transferred to another owner
   • Location for specific programs. Gifts of real property may be accepted if the property provides a direct enhancement for a particular program (e.g., land or facility for a research site, demonstration area, field teaching laboratory, or public 21 education site). In these cases, the specific gift must provide a unique opportunity or other advantage that could not be achieved by using resources owned by others (e.g., long term research and the ability to generate grants in support of existing research often depends on the ability to assure that land use will not change over time and that research will not be compromised by the disturbance of research areas that must be maintained as undisturbed sites; University ownership may better support this objective than a short term or long- term lease of land). Proposals to accept gifts of real property that support programmatic goals must address the following:
     • The intended use of the gift
     • The relation of the gift to a programmatic interest of the University
     • A logistical plan for managing the property
     • The expected annual net returns to the University over the expected retention period of the property
     • The identification of a source of funds to cover expenses incurred while holding the property until it generates income
     • Specific criteria to be used over time to evaluate the proposed business plan to enable a judgment as to whether the property should be retained, used for another purpose, sold, or transferred to another owner
     • The immediate and long term potential for the gift to support one or more specific programs
     • The faculty/staff and programs that the gift would support
     • The uniqueness or special value of the gift to support the identified programs
     • A proposed financial, management, and maintenance plan for the property and the programs that will occur on it

3. Other institutional purposes. Gifts of real property may be accepted if the gifts are determined to be valuable assets to the University for other appropriate purposes (e.g., serving as a potential site for a University facility, serving as a potential site for a cooperative venture with another state agency, being a part of a major grant submission, adding to the cultural richness of the University, permitting the retention of farmland or open space, or historical-site conservation). Proposals to accept gifts for other institutional purposes must include all of the following information, and be supported by a compelling rationale for acceptance of the gift:
   • The intended use of the gift
   • The relation of the gift to a programmatic interest of the University
   • A logistical plan for managing the property
   • The expected annual net returns to the University over the expected retention period of the property
   • The identification of a source of funds to cover expenses incurred while holding the property until it generates income
   • Specific criteria to be used over time to evaluate the proposed business plan to enable a judgment as to whether the property should be retained, used for another purpose, sold, or transferred to another owner
   • The immediate and long term potential for the gift to support one or more specific programs
   • The faculty/staff and programs that the gift would support
   • The uniqueness or special value of the gift to support the identified programs
   • A proposed financial, management, and maintenance plan for the property and the programs that will occur on it

Procedure for routing a request to accept gifts of real property

Proposal. The development officer working with the donor should contact OGP to begin a review of a potential gift of real property. OGP will coordinate the required due diligence process through RED.
Certain information is needed to evaluate a proposed gift, including the current deed and property description; recent property tax bill; most recent survey and map of the property; information regarding known easements, restrictions, covenants, zoning information, right-of-way, and conservation easements; current or former uses of property; copy of any current leases, mortgages, liens, assessments, and homeowner association agreements; most recent appraisal, environmental study, or report; listing of any litigation, pending litigation, disputes, issues with neighboring developments; and any disclosures or known issues that might affect either the use or the sale of the property.
The development officer can help the process by supplying the OGP with as much of this information as possible when initiating the proposal.

1. Initial Review. The development officer should provide the following information for the initial review of the property by RED: The property address, owner name, and the tax parcel identification number; any notes from the owner regarding the current use or intended use, the market history or expected marketability (this would include the owner’s opinion of value if they have expressed one); and notes from the development officer regarding whether the property is being considered for programmatic purposes or for resale. In addition to the above information, the RED may also contact a local broker to request an opinion regarding the marketability of the property. The RED will then provide an initial opinion regarding the viability of proposed property as a gift under the criteria outlined above.
2. Due Diligence. In the event that the entity receiving the gift elects to proceed with the proposed gift of real estate following receipt of the initial opinion from RED, then RED must engage in a due diligence process to evaluate the potential liabilities and opportunities offered by said gift. The requirements for a given property will be determined by RED, and will typically include a survey, a commitment for title insurance, a Phase One environmental site assessment and, if appropriate, a home or building inspection conducted by a qualified individual or firm. Other assessments may be required as warranted by a specific property. OGP will coordinate the due diligence process with the development officer and the donor.
3. Appraisal. In order to claim an income tax charitable deduction, the donor must have the real estate appraised by a “qualified appraiser”, as defined by the Internal Revenue Service. Such an appraisal can be completed no earlier than 60 days before the date of the gift. As the appraisal is for the primary benefit of the donor, its cost is the responsibility of the donor. Typically, RED requires a copy of the appraisal prior to completing its due diligence in order to assess the marketability of a proposed gift.
4. Land Use Plan. The development officer must advise RED which acceptance rationale listed above—real property to be sold, programmatic purpose, other institutional purpose—that the proposed gift meets, and must provide an explanation of how the issues identified above under the appropriate rationale will be addressed.
5. Recommendation. Upon satisfactory completion of its due diligence process and receipt of a land use plan, RED will issue a recommendation to accept the gift. This recommendation must be accepted by both the VC of UA and the VC of FA. RED will forward the recommendation to the applicable department head/program director and college dean/vice-chancellor, the executive director of OGP and the University Treasurer. OGP will coordinate the acceptance of both Vice Chancellors and, of any other entity that may be required.
6. Completion. Once the recommendation has been accepted, the OGP will coordinate the completion of the gift with the development officer and the donor. A real estate gift is typically complete when a deed transferring the property is delivered to the University or the UAE. OGP will also work with the development officer and the donor to ensure that the deed is recorded in the appropriate court records.

In order for RED to obtain the required due diligence, complete and thorough review of the property, provide a recommendation of gift acceptance, and coordinate the completion of the gift within a given calendar year; the request for initial review should be received by OGP no later than October 15 of said year.

Expenses incurred during the proposal process

Expenses incurred during the proposal process for the primary protection of the donor—including the appraisal and deed—are the responsibility of the donor. Expenses incurred for the primary protection of the entity receiving the gift—including environmental review, title search, and home inspections—are the responsibility of the entity. Donors are always encouraged to make gifts to defray the entity’s costs. Any such commitment by the donor should be documented in writing.

1. Transmittal. Gifts & Records Management (GRM) will process the gift via a BA-151 form prepared by the OGP after the deed to the University or a University Associated Entity is received. The BA-151 is sent to GRM with a copy of the deed and the qualified appraisal of the property. Copies are sent to Foundations Accounting & Investments (FAI) and the receiving development office working with the donor. GRM will record the gift in the advancement database.
2. IRS form. Internal Revenue Service (IRS) Form 8283 may be required for the donor to substantiate a charitable deduction for any non-cash gift on his or her personal income tax return. The preparation of Form 8283 is the responsibility of the donor or his or her tax advisor. Please forward the completed Form 8283 (both pages), bearing the appraiser’s original signature, plus a copy of the appraisal or other substantiating documentation to OGP. OGP will coordinate signatures from the appropriate Officer of the University.
3. Recognition. The donor’s giving record will receive legal (hard) credit with the appraised value of the real property. Recognition (soft) credit is given automatically to the spouse/partner.
4. Receipt. The receipt issued will show a description of the property only. GRM will receipt the gift on the date the gift transmittal form is processed by GRM. Normally, receipts will be mailed to donors within two business days after processing.

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Deferred gifts

Life income gifts

Life income gifts, also known as “split interest gifts,” refer to various types of Charitable Remainder Trusts (CRT) and Charitable Gift Annuities (CGA).The gift is split between two beneficiaries: (1) the “income stream,” or non- charitable portion, provides payments to the donor and/or loved one for his or her lifetime, or for a term or years; and (2) the “remainder interest,” or charitable portion, which is the trust portfolio that remains after the trust is terminated. The Office of Gift Planning (OGP) should be consulted whenever a life income gift is considered as a possible gifting option.

Once terminated, the remainder interest is transferred to the University or a University Associated Entity, per the CRT or CGA agreement, in the manner specified by the donor. These gifts include charitable remainder trusts (e.g., annuity trusts, unitrusts, FLIP unitrusts, etc.) and charitable gift annuities (immediate and deferred).

Following are requirements for CRTs and CGAs:

• Charitable remainder trusts (CRT):
  • Minimum gift – $100,000
  • Payout rate – up to 7% (appropriate rate will vary with age/term of trust/initial funding level)
  • Minimum age of income beneficiaries – 50, unless the trust is for a term of years
  • Funding – cash, stock, real estate, appreciated assets, IRA qualified charitable distribution
  • Remainder Beneficiary – may include other charities, as long as the University or a University Associated Entity collectively receive no less than 50% of the remainder
  • Trustee – For portfolios comprised only of cash, stock, or IRA qualified charitable distributions, the University or a University Associated Entity is preferred as the Trustee. For CRTs funded with real estate or other appreciated assets, the donor may self-trustee or appoint another person to serve as Trustee. The University or a University Associated Entity is preferred to serve as Successor Trustee in the Trust Agreement only after the real estate or other appreciated assets has been sold.

• Charitable gift annuities (CGA):
  • Minimum gift – $10,000
  • Payout rate – The maximum rate that can be offered is the rate suggested by the American Council on Gift Annuities based on the donor or donors’ age(s). In no case will the suggested rate exceed 9%.
  • Funding – cash, stock, IRA qualified charitable distribution
  • Minimum age of income beneficiaries:
    • – 50 for immediate annuity
    • – 40 for a deferred annuity, provided deferral period is to at least age 55

Exceptions to these requirements must be approved by both the Vice Chancellor for University Advancement and the Vice Chancellor for Finance and Administration.

While life income gifts offer benefits to both the donor and the University, they also can present risks. To manage these risks, all life income gifts should be coordinated with the OGP. For gifts that will be managed by a University Associated Entity, and for gifts involving any real estate transfer, the OGP will coordinate the preparation of the applicable agreements and the transfer of assets. Costs associated with the formation of a CRT, such as legal fees to draft the trust agreement, appraisal fees, etc., are the responsibility of the donor.

All life income gift agreements that name the University or University Associated Entity as a party to the CGA Agreement or Initial Trustee of a CRT, must be signed by the donor, the president or designated officer of the University Associated Entity (or the Chair of the Board of Trustees for the Endowment Fund of NC State University), and the entity’s Treasurer. If the University or University Associated Entity is named as a Successor Trustee of a CRT, the donor and initial Trustee must sign; it is recommended that the president or designated officer of the University Associated Entity (or the Chair of the Board of Trustees for the Endowment Fund of NC State University), and the entity’s Treasurer also sign to acknowledge the gift.

Procedure for processing life income gifts

1. Transmittal. The OGP is responsible for preparing the Deferred Gift Transmittal form for all life income gifts. The OGP will also prepare all supporting documents needed by the donor to claim his or her charitable income tax deduction and transmit those materials to the donor with the required disclosure statements. Additionally, the OGP will provide to the appropriate development officer, Foundations Accounting & Investments (FAI), and Gifts & Records Management (GRM) copies of all relevant documents pertaining to the gift. GRM will record the gift in the advancement database.
2. IRS form. Internal Revenue Service (IRS) Form 8283 may be required for the donor to substantiate a charitable deduction for any non-cash gift on his or her personal income tax return. The preparation of Form 8283 is the responsibility of the donor or his or her tax advisor. Please forward the completed Form 8283 (both pages), bearing the appraiser’s original signature, plus a copy of the appraisal or other substantiating documentation to the OGP. OGP will coordinate signatures from the appropriate Officer of the University.
3. Recognition. The donor’s giving record will receive legal (hard) credit with the net present value of the remainder interest based on the date of the gift, per the calculation required by the IRS. The donor receives recognition (soft) credit with the fair market value of the gift per appraisal, stock valuation per IRS guidelines, etc., as is the giving record of the surviving spouse/partner. Please contact the OGP with any questions regarding life income gifts.
4. Receipt. GRM will receipt the gift on the date the gift transmittal form is processed by GRM. Normally, receipts will be mailed to donors within two business days after processing. Receipts for deferred gifts reflect donation of the gift, but not the gift’s value.

Unrestricted Bequests

Unrestricted bequest gifts received by the University (not a University Associated Entity) that are under $100,000 are deposited into the University Enhancement Fund within the Endowment Fund, an unrestricted endowment fund spent by the Chancellor.

Unrestricted bequest gifts $100,000 and greater are referred to the VC for University Advancement and the University Treasurer. They will coordinate with the Chancellor to determine the appropriate allocation.

Unrestricted bequest gifts received by a University Associated Entity will be allocated at the direction of the entity’s Board of Directors.

Revocable gifts

Revocable gifts are legal arrangements in which a donor makes a provision in an estate plan or other estate document that may be changed during a donor’s lifetime, including but not limited to, bequests from a Will or Revocable Trust, and beneficiary designations from a retirement plan, life insurance policy, or annuity. A revocable gift will benefit the University or a University Associated Entity at some future time—typically at the end of the donor’s life. The donor has the legal right to change a revocable gift before the gift is received. The Office of Gift Planning (OGP) should be consulted whenever a revocable gift is considered as a possible gifting option.

In order for a revocable gift to be recorded, a donor must document (a) a general description of the gift provision, (b) the current estimated value of the gift, and (c) any designation of the gift’s use. Clear documentation is beneficial in ensuring the donor’s wishes are fulfilled and that the University or a University Associated Entity may benefit from a more streamlined process after the donor has passed away. It is important to note that many life insurance and retirement account providers will not contact a beneficiary upon a donor’s death; their internal policies consider it the responsibility of the beneficiary. The provision must be active/in force prior to an SOI being signed and recorded in the advancement CRM.

The Gift Officer is responsible for securing the following documentation from the donor: a Statement of Intent and a copy of the gift provision, such as a photocopy of the Will bequest language, beneficiary designation form, etc. All documentation should be forwarded to the OGP for review. Upon review, the OGP is responsible for preparing the gift/pledge transmittal form and submitting it to Gifts & Records Management (GRM).

If the donor declines to provide provision documentation or states they will provide a copy of the active provision at a future date, the Gift Officer should draft a memo to Office of Gift Planning outlining the following for review along with the signed SOI:

• Reason the donor is declining or delaying providing a copy of the provision
  • If delaying, affirm the provision is active (provisions still being written cannot be counted)
• The plan to follow up and secure documentation (if delaying)
• Affirm a conversation was had with the donor regarding the purpose of providing a copy of the provision.
• Document what information is known via conversations with donor about the provision

Should the donor only provide a percentage of estate and not an estimated value with the Statement of Intent and copy of gift provision, the gift will be recorded at $2.00. This can be revised should the donor document an estimated value in the future.

Contingent gifts

Contingent gifts indicate that a gift will be transferred to the beneficiary (the University or a University Associated Entity) only after the death of the donor plus another specified person (typically a spouse). A contingent gift may be recorded at the estimated value only if the donor and the other specified person document that both parties have included the same gift provision in their estate plans. When this occurs, a gift is assured regardless of the order of death.

In the case of retirement account(s), if the University or a University Associated Entity is listed as a secondary/contingent beneficiary, the gift may only be counted at the estimated value if the primary beneficiary of said retirement account(s) agrees in writing to name the University or a University Associated Entity as a primary beneficiary on the inherited account(s) upon transfer. In this instance, the University or a University Associated Entity will receive the funds after the death of the survivor. When this occurs, a gift is assured regardless of the order of death. The Office of Gift Planning (OGP) will draft the memo for donors to review and sign.

Otherwise, a contingent gift will be recorded at $1.00. (Exceptions may be made with the approval of the Vice Chancellor for University Advancement when the documented terms of the gift demonstrate a reasonable likelihood that a gift will be received.)

Undocumented Intents

In some instances, a donor may only indicate in an informal way that the University or a University Associated Entity has a prevision in their estate plan or other estate document. This could be via a response to a survey, an annual gift, or during a visit or donor correspondence. Absent of a signed Statement, an intent cannot be recorded. If, after attempts by the Office of Gift Planning (OGP), further documentation cannot be collected, Office of Gift Planning will record in the donor database the intent of the donor, but no transaction will be recorded.

Procedure for processing revocable gifts

1. Transmittal. Documentation for all revocable gifts should be transmitted to the OGP. The OGP is responsible for preparing the gift/pledge transmittal form and submitting it to GRM. GRM will record the gift in the advancement database.
2. Recognition. The donor’s giving record will receive legal (hard) credit with the documented estimated value of the gift. Recognition (soft) credit is given automatically to the spouse/partner.
3. Receipt. Receipts are not issued for revocable gifts.

Charitable lead trusts

In a lead trust, payments are made first to a charity, such as the University or a University Associated Entity. At the end of the trust term, the remainder reverts to one or more individuals (typically heirs).

Distributions from a lead trust are processed like cash distributions from other private foundations. However, if the trust provides an irrevocable, dedicated income stream to the University or a University Associated Entity, then a greater amount can be recorded in the advancement database, as described below.

Because of the potential conflicts of interest, neither the University nor a University Associated Entity will serve as trustee of a charitable lead trust.

The Office of Gift Planning (OGP) should be consulted whenever a charitable lead trust is considered as a possible gifting option.

Procedure for processing a charitable lead trust

1. Transmittal. The OGP will process the gift of a CLT, which includes the preparation of the Deferred Gift Transmittal form and the submission of all required documentation to Gifts & Records Management (GRM) for recording in the advancement database. If the lead trust provides an irrevocable stream of distributions to the University or a University Associated Entity, the future anticipated distributions can be recorded in the advancement database. Five years of distributions can be recorded as a current pledge. When a CLT is first recorded in the advancement database, the present value of the future income stream to the University or University Associated Entity may be recorded as a revocable gift. No pledge reminders will be generated for any pledge recorded under this procedure. Please contact the OGP with questions regarding CLT gifts.
2. Recognition. The donor’s giving record will receive legal (hard) credit with any distributions received or anticipated under the above guidelines. Recognition (soft) credit is given automatically to the spouse/partner.
3. Receipt. GRM will receipt distributions received on the date the gift transmittal form is processed by GRM. Normally, receipts will be mailed to donors within two business days after processing.

Insurance gifts

There are numerous ways in which a donor can use an insurance policy to make a gift. Because a gift of life insurance has many variables, the Office of Gift Planning (OGP) should be consulted whenever a life insurance gift is being considered.

1. Donor Retains Ownership of the Policy, University is named Beneficiary. If the donor retains ownership of the policy, a commitment to name the University or a University Associated Entity can be recorded by following the procedures for a Revocable Gift. Future payment of premiums does not qualify as a gift to the University. For a term life policy, a commitment to name the University or a University Associated Entity can be recorded by following the procedures for a contingent Revocable Gift.
2. Gift of Policy to University or a University Associated Entity, University or University Associated Entity becomes Owner and Beneficiary. A donor may wish to transfer ownership of a policy in order to take advantage of available income tax benefits. The gift may qualify for a current income tax charitable deduction, based on the interpolated cash reserve on the date of the gift, as documented by Form 712, which is prepared by the policy’s issuer. The gift will be recorded as a legal (hard) credit for the interpolated cash reserve and a recognition (soft) credit for the face value of the policy. To qualify for future income tax charitable deductions, the donor should direct payment of future premiums as a current cash gift to the University or University Associated Entity. Payment of each future premium will be recorded as a current cash gift. The University or University Associated Entity will pay premiums to the insurer directly.
3. Purchase of New Policy in the name of the University or a University Associated Entity, University or University Associated Entity becomes Owner and Beneficiary. Other donors may wish to establish a new policy. The policy should be purchased in the name of the University or a University Associated Entity, payment of the initial required premium should be a current cash gift to the University, and the University will provide payment to the insurer to purchase the policy. Typically, a check must be attached to the policy’s application. The gift will be recorded as a legal (hard) credit for the cash payment for the initial premium and a recognition (soft) credit for the face value of the policy. Payment of each future premium will be recorded as a current cash gift. The University or University Associated Entity will pay premiums to the insurer directly.

Any gift involving a gift of life insurance should be referred to OGP. OGP will evaluate the policy and discuss its suitability as a gift with the development officer and/or the donor. Not all policies are designed to accomplish the donor’s or the University’s objectives. Term policies will not be accepted.

The OGP will then work with the donor, the appropriate officers at the University or University Affiliated Entity, and the insurance company to complete the transfer.

If premiums remain to be paid, the donor will make gifts at least equal to the amount of such future premiums. Such gifts will typically be either cash or publicly traded securities and will be processed in the same manner as described above for such assets.

Procedure for processing insurance gifts

1. Transmittal. Documentation for all insurance gifts should be forwarded to the OGP for processing, which will prepare the Deferred Gift Transmittal form and forward it to Gifts & Records Management (GRM) for recording in the advancement database. For policies involving the transfer of ownership, it will include documentation that ownership has been transferred and of the value of the policy at the time of transfer (typically provided on IRS Form 712). For gifts of insurance premiums, such gifts shall be processed using the procedures for the asset funding the premium gift (cash or publicly traded securities). For gifts that involve no change in ownership, they will be processed as Revocable Gifts.
2. IRS form. Internal Revenue (IRS) Form 8283 may be required for the donor to substantiate a charitable deduction for any non-cash gift on his or her personal income tax return. The preparation of Form 8283 is the responsibility of the donor or his or her tax advisor. Please forward the completed Form 8283 (both pages), bearing the appraiser’s original signature, plus a copy of the appraisal or other substantiating documentation to the OGP. OGP will coordinate signatures from the appropriate Officer of the University.
3. Recognition. The donor’s giving record will receive legal (hard) credit with the value of the policy per Form 712, typically the interpolated cash reserve as of the date of the gift (e.g., when transfer of ownership has occurred). In addition, the donor will be given legal (hard) credit for the value of any premium gifts made directly to the University or University Associated Entity, as of the date they are received. The policy face value will also be recorded as recognition (soft) credit to the donor. This will be done, even when ownership is transferred, in order to ensure that the advancement database reflects the full scope of the donor’s insurance gift. Recognition (soft) credit is given automatically to the spouse/partner.
4. Receipt. GRM will receipt distributions received on the date the gift transmittal form is processed by GRM. Normally, receipts will be mailed to donors within two business days after processing.

Individual Retirement Account gifts

A charitable IRA rollover, or qualified charitable distribution (QCD), has been permitted by the IRS to allow certain donors (those over 70½) to exclude from taxable income (and count toward their required minimum distribution) certain transfers of Individual Retirement Account (IRA) assets that are made directly to public charities. An Individual Retirement Account (IRA) Qualified Charitable Distribution (QCD/IRA rollover) can be given through the Office of Gift Planning (OGP). Instruct the donor to initiate this type gift through their IRA plan administrator to University or University Associated Entity. Contact the OGP with questions regarding IRA gifts.

Procedure for processing IRA gifts

1. Transmittal. GRM will process an IRA gift with assistance from OGP. The Contribution Transmittal form and the submission of all required documentation should be sent to Gifts & Records Management (GRM) for recording in the advancement database
   • A Decedent IRA is an inherited IRA. These are special IRAs whereby the original owner of the IRA has passed away and the IRA money has been transferred (inherited) to the beneficiary in the form of the decedent IRA. The withdrawal rules for an inherited IRA are different from the rules that apply to an original owner. Contact OGP for more details.
2. Recognition. The donor’s giving record will receive legal (hard) credit with any distributions received or anticipated under the above guidelines. Recognition (soft) credit is given automatically to the spouse/partner.
3. Receipt. GRM will acknowledge distributions received on the date the gift transmittal form is processed by GRM. IRA charitable rollover gifts do not qualify for a charitable deduction so an acknowledgment letter will be generated but no gift receipt will be issued. Normally, receipts will be mailed to donors within two business days after processing.

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Third-Party Fundraising and Crowdfunding

All fundraising campaigns benefiting NC State should be coordinated with University Advancement per POL 03.00.01.  Efforts should be made to avoid third-party fundraising campaigns.

External Fundraising

On occasion, a party external to NC State will establish a fundraising campaign without NC State’s awareness and without using NC State’s approved fundraising platforms. Examples of these third-party fundraising campaigns include GoFundMe, Facebook Fundraisers and other efforts by individuals to collect funds personally. These campaigns are not NC State-sanctioned fundraising initiatives. Gifts made to these fundraising campaigns are not gifts to NC State or its University Associated Entities. 

In these instances, the organizer should provide the proceeds to the University or the appropriate University Associated Entity. The legal gift credit will be applied to the payor on the check (or ACH transfer.) Individual donors to the third-party fundraiser will not receive legal credit or gift receipt as they did not make a gift to the University or its University Associated Entities.

Pooled Gifts

Any effort to pool gifts from multiple donors to meet an endowment or gift minimum needs to be approved by Advancement Services prior to fundraising.

NC State Crowdfunding

NC State’s Annual Giving office hosts crowdfunding campaigns to benefit approved NC State initiatives throughout the year via an approved crowdfunding platform. Contact the Director of Annual Giving for more information.

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Politically affiliated gifts

Political Action Committee (PAC) Matching Gifts

Employees at companies with Political Action Committee (PAC) matching gift programs contribute to the company’s PAC and then choose a charity to receive a contribution of equal value from the company. In recognition of the employee’s contribution to its PAC, the company (not the PAC) sends a contribution to the charity identified by the employee. NC State is able to record the matching PAC transaction as a non-charitable contribution since the contribution is not tax deductible (and not countable in fundraising totals per CASE guidelines).

NC State and University Associated Entities accept these funds as non-charitable contributions/other income recorded as revenue via FAI. The funds will not be processed as charitable contributions, are not recorded in the advancement database and no additional acknowledgement will be sent from Advancement Services.

Highlights for PAC contributions:

1. These are not charitable transactions.
2. The contribution is directed to NC State or University Associated Entity based on the individual contributor to the PAC matching program.
3. Matching PAC funds are contributions coming from the associated corporate entity and not directly from PAC funds.

Other Politically-related gifts

Funds received directly from a PAC or other political organization/campaign are reviewed by the Gift Acceptance Committee for acceptance.

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Gift + other income (quid pro quo)

Quid pro quo gifts occur when the donor is provided something in exchange for the gift, such as tickets for a dinner, concert, or other event. The development officer is responsible for providing Gifts & Records Management (GRM) with the fair market value associated with attending the event that serves as the miscellaneous gift. It is the responsibility of the office sponsoring the event to retain the records proving the value of the ticket, dinner, or other tangible benefit for Internal Revenue Services (IRS) purposes. Failure to keep the information could result in fines and potential loss of tax-exempt status.

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Miscellaneous gifts

Other types of gifts that may require special receipts and review prior to accepting the gift include: inventory, artistic property created by the donor or the donor’s spouse or received as a lifetime gift from the artist, real property subject to depreciation recapture, and Section 306 stock. Contact Gifts and Records Management (GRM) prior to accepting any of these type gifts.

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SUPPLEMENTAL INFORMATION AND EXCEPTIONS

Gifts that warrant further review and approval

Exceptions to this policy or gifts needing further review will be considered on a case-by-case basis by the Vice Chancellor for University Advancement who will make the decision to accept, reject or escalate the gift discussion in consultation with university and foundation leaders, or the Gift Acceptance Committee, as appropriate. Gifts that may require further review:

• Gifts of personal property if they are not to be used by the University
• Gifts of real or personal property subject to donor restrictions regarding the disposal of such property
• Any bargain sale of property where a gift element is associated with the acquisition of property by the University or University Associated Entity below its fair market value
• Gifts of software/software licenses
• Gifts of non-marketable securities, complex assets, cryptocurrency
• Cash gifts with significant donor restrictions
• Gifts of unusual items or gifts of questionable value
• Gifts that require additional expenditures by the University or a University Associated Entity
•  Gifts that may be in conflict with POL 03.00.01 – Coordination of Fundraising Activities and Acceptance of Private Donations (Gifts)

Development officers should contact the Office of Gift Planning (OGP) and Gifts and Records Management (GRM) for assistance with gifts in this category. These gifts will require prior approval by the Vice Chancellors for University Advancement and Finance and Administration.

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Gifts, Grants and Contracts

The University, via a 3D Memo has defined the difference between gifts, grants, and contracts. Visit https://go.ncsu.edu/giftsgrantscontracts for more information and resources.

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Gift Acceptance Committee (GAC)

At the direction of the Vice Chancellor for University Advancement, the Gift Acceptance Committee may be convened to review and provide recommendation on the acceptance or the returning of a gift to the University or a University Associated Entity.
The chair of the Gift Acceptance Committee shall be appointed by the Vice Chancellor for University Advancement or their designee. Members should include:

• Associate Vice Chancellor of Advancement Services (Chair)
• Associate Vice Chancellor of University Development
• Executive Director of Gift Planning
• Senior Director for Foundations Accounting & Investments
• Assistant Vice Chancellor of Finance and Business
• Director of Gifts and Records Management
• Office of General Counsel Representative
• Other employees as appointed by the Vice Chancellor for University Advancement

Committee may consult with university administrators on particular gifts, as deemed appropriate by the Vice Chancellor for University Advancement.

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Refunding of gifts

Very rarely, the University or a University Associated Entity may feel it necessary to refund a gift, either because it is in the best interest of the University or University Associated Entity to do so or because conditions agreed to in accepting the gift cannot or will not be met. Requests for refunds under $10,000 must be sent to the Associate Vice Chancellor, Advancement Services for approval. Refund requests over $10,000 must be sent to the Vice Chancellor for University Advancement for approval prior to making a commitment to process the refund to the donor. If approved, the request must be sent to Gifts & Records Management (GRM) by the University or University Associated Entity as a gift reversal. GRM will forward the request to Foundations Accounting & Investments (FAI) and will adjust the donor’s giving record for the refund. If the donor has filed a tax return claiming a charitable deduction for the gift, the donor will need to contact his or her tax advisor to determine if the donor needs to amend his or her tax return. The University requires a completed W-9 be received prior to a refund being issued and may be required to issue a 1099 to the donor for the refund.

Refund requests for non-charitable event registration fees require approval by Director of GRM or Senior Director Advancement Services. Event Fee refund requests must be received before the date of the event.

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Discounts on materials and services

Corporations and/or individuals may offer significant discounts on materials and/or services to the University or one of the University Associated Entities. This is commonly referred to as a bargain sale.

For educational discounts No gift receipt will be issued, as this is not considered a gift under Internal Revenue Services (IRS) guidelines. The donor’s giving record will not be credited. The unit receiving the discount on materials or services may, at its discretion, send a letter of acknowledgement to the donor.

The valuation of a “bargain sale” gift for recording purposes should be the difference between the discounted amount and the retail/ educational value/ apprised amount. Bargain sales will be processed as a gift-in-kind. The unit receiving the discount on materials or services may, at its discretion, send a letter of acknowledgement to the donor. The receipt will indicate details of the bargain sale with special wording to indicate sale (“Thank you for your bargain sale of GIK description”) for those donations qualifying as bargain sales see additional details in IRS Publication 526.

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Gifts from University faculty and staff

University faculty and staff members may make gifts to the University or University Associated Entities, provided they do not receive personal direct benefit from the gift and are accounted for according to applicable tax and accounting requirements. Caution should be exercised to avoid impermissible personal benefits or the appearance of self-dealing or conflict of interest.

Gifts from faculty and staff (F/S) of NC State (or their spouse) must meet the following three criteria in order to be accepted:

1. Charitable intent should be the primary reason for making the contribution
2. The contribution must be credited to a fund not under sole control of or does not financially benefit the donating faculty or staff member personally
3. The faculty or staff donor should not receive or expect to receive future remuneration from the fund to which his or her gift was credited

Examples of acceptable gifts include:

• Gifts to enhancement funds, even in the F/S’s unit of employment, provided the fund is used for a myriad of expenditures
• Gifts to create or support scholarship funds, even in the F/S’s unit of employment, provided the recipients are selected in accordance with standard university policies and procedures
• Donations to capital projects, such as buildings, even if is related to the F/S’s unit of employment
• Estate, CRTs, life insurance and other deferred gifts that are received after the F/S member is no longer employed by the university
• Signing an honorarium check over to the department, at which point that faculty member does not have control over the receiving fund (this is taxable income to the faculty member as well)

Examples of unacceptable gifts include:

• Gifts to create or support research in a faculty member’s specific area of research
• Gifts to an existing professorship, chair, director’s fund, dean’s fund, coach fund, etc. while the donor is holding the position

Some gifts from F/S members may require review by the Gift Acceptance Committee to ensure the gift does not result in an impermissible personal benefit and that the gift does not have the appearance of self-dealing or a conflict of interest. 

Questions regarding accepting a F/S gift should be directed to the Associate Vice Chancellor for Advancement Services which serves as the chair of the Gift Acceptance Committee.

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Wolfpack Club Lifetime Giving Credit

In rare instances, gifts that are received by the University or University Associated Entities and receipted by Gifts and Records Management (GRM) may also receive Wolfpack Club lifetime giving credit. The lifetime giving credit is an element of the Wolfpack Club’s priority point calculation and thus may influence a donor’s athletic seating purchase. Lifetime giving credit does not satisfy any requirement for donation to purchase seating however may impact the order or priority of purchase. In consideration of this potential benefit, all gifts receiving WPC lifetime giving credit must have the following statement:

This gift may receive Wolfpack Club lifetime giving credit which is used in calculating priority points that are used for the right to purchase NC State athletics home seating. This may impact the tax-deductibility of your gift. Please consult your tax adviser.

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Name, Image and Likeness (NIL)

Name, Image and Likeness (NIL) refers to the rights of student-athletes to monetize and receive compensation for the use of their name, image, and likeness. This includes, but is not limited to, activities such as endorsements, sponsorships, social media promotions, personal appearances and other commercial activities.

A Collective is an organization typically formed by boosters, fans, or businesses with the purpose of pooling resources to support student-athletes’ NIL activities. Collectives may facilitate NIL opportunities, provide financial support, and assist with marketing efforts to help student-athletes maximize their NIL potential. These organizations operate independently from the University.

Contributions to a Collective benefiting NC State athletes are not gifts to NC State, the Student Aid Association or any other University Associated Entity. Therefore, these contributions are not captured in the advancement database, are not receipted by Advancement Services or included in any fundraising totals or reports.

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Exception from Gift Assessment Fee

Any exception from the University Advancement gift assessment must be approved by the Vice Chancellor for University Advancement. In rare occasions, a non-profit may restrict the assessment of a charitable gift. To honor this request, Gifts and Records Management (GRM) must receive appropriate documentation from the non-profit, such as by-laws, stating this restriction.

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Requesting Chartfield

Foundations Accounting and Investments (FAI) is responsible for the approval and set up of new foundation funds in financials and in the advancement database. FAI strives to set up new funds as quickly as possible after receipt of the request. Requests are normally set up within two business days, assuming all information needed to establish the request in both the financials system and the advancement database has been provided. Requests to establish new funds should be submitted via the Chartfield Request System (accessible through MyPack Portal).

The Chartfield Request System is a module within financials. Through this module campus users can make requests to add, modify, or inactivate a Project Segment (also called Project ID) or a Department (OUC), specifically for foundation (Ledger 6 funds) and University Endowment Fund (housed in Ledger 7) new project requests.

For more information please review instructions for Chartfield Requests by visiting the FAI website or clicking the links below.

• Chartfield Request Process
• Chartfield System Training

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