Q&A: Third-Party Contributions
January 20, 2011
Question: Are there any issues with a church accepting a “third-party” check and providing a contribution receipt. (check payable to John; John endorses back of check & places in offering plate; John wants a receipt…) I do not find anything that specifically addresses this question; one possibility would be to record this as a cash contribution and give John a receipt (make a copy of front/back of check and attach to deposit records).
The issue you raised is one that I have not dealt with and I am not sure there is a great and simple answer. I like your answer and think that under the situation, it is as good as you can give. However, my concern is that the donor may be trying to shield income. For example, the donor is being paid for services performed for the person writing the check. Instead of having the check deposited into his account and thus create a record of the income, he signs it over to the church. If the donor lacks in integrity, he may be trying to avoid the possible income tax on the payment but claim a charitable receipt for the money.
If this happens one time, I do not think it is a big issue. However, if it happens repeatedly, I would suggest that the church tell the donor that they are not going to be able to take third-party checks in the future. I would not want to see the church participating in an income-hiding scheme.