Christmas Fund

Discuss questions around local unit policies for budgeting, reconciling, etc. This forum should not contain specific financial or membership information.
john.orme
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Christmas Fund

Postby john.orme » Tue Nov 29, 2011 12:49 am

We've had a bishop in our stake ask us if it would be appropriate to start a Christmas Fund within his ward. He has several families that want to donate money to anonymously help some of the needy families in the ward have a more enjoyable Christmas. The ward financial clerk would open up a subcategory in the 'Other' account where the money would be collected, and then the bishop would use those funds to provide holiday meals, Christmas trees or presents depending on each of the family's needs. Is this an appropriate use of the 'Other' fund?

crislapi
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Postby crislapi » Tue Nov 29, 2011 2:31 am

john.orme wrote:We've had a bishop in our stake ask us if it would be appropriate to start a Christmas Fund within his ward. He has several families that want to donate money to anonymously help some of the needy families in the ward have a more enjoyable Christmas. The ward financial clerk would open up a subcategory in the 'Other' account where the money would be collected, and then the bishop would use those funds to provide holiday meals, Christmas trees or presents depending on each of the family's needs. Is this an appropriate use of the 'Other' fund?

Many wards do a sub-for-santa fundraiser at Christmas time to help make Christmas possible for disadvantaged families using this same mechanism. The bishop can authorize the use of the Other account. So long as the funds are collected in a manner that is approved (not solicited), I would think this is a great way for these families to celebrate Christmas. This is something they could do on their own, but I think the bishop is in a much better position to know who would benefit the most so it makes sense to do this through the him.

If they truly want to be anonymous, be sure to assign the donations to "anonymous".

atticusewig
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Postby atticusewig » Tue Nov 29, 2011 8:07 am

crislapi wrote:Many wards do a sub-for-santa fundraiser at Christmas time to help make Christmas possible for disadvantaged families using this same mechanism. The bishop can authorize the use of the Other account. So long as the funds are collected in a manner that is approved (not solicited), I would think this is a great way for these families to celebrate Christmas. This is something they could do on their own, but I think the bishop is in a much better position to know who would benefit the most so it makes sense to do this through the him.

If they truly want to be anonymous, be sure to assign the donations to "anonymous".


A few things to note:

1) Other/AMFA payments will not show up on the Tax-valid statement as they are
usually used in a pass-through taxable manner, so be sure the donors know
that if they give a sizable amount they might need to generate their own
paperwork at tax time.

2) Like all Other/AMFA accounts, all of the funds collected should be spent for
the purpose collected. Leaving a balance in this account shouldn't happen.

3) Purchases should be traceable by receipt, even if it means more work for the
people involved. Too often, I've seen leaders use the money to give store
"gift cards" to the families in need. Last I checked, this was against policy.
All expenses should be properly documented, and gift cards are like giving
the people a blank check (also against policy, I'm told).

kisaac
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Postby kisaac » Tue Nov 29, 2011 8:50 am

john.orme wrote:He has several families that want to donate money to anonymously help some of the needy families in the ward have a more enjoyable Christmas.
I think where the "anonymously" comes in can be important. Perhaps donors can speak privately with bishops, so donations to the ward are not anonymous, so that receipts and taxes and the proper accounting methods are always correct, and above question at audit/tax time, but the ward then keeps the giver anonymous.

allenjpl
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Postby allenjpl » Tue Nov 29, 2011 11:16 am

john.orme wrote:We've had a bishop in our stake ask us if it would be appropriate to start a Christmas Fund within his ward. He has several families that want to donate money to anonymously help some of the needy families in the ward have a more enjoyable Christmas. The ward financial clerk would open up a subcategory in the 'Other' account where the money would be collected, and then the bishop would use those funds to provide holiday meals, Christmas trees or presents depending on each of the family's needs. Is this an appropriate use of the 'Other' fund?


Bishops are, by and large, friendly folk who really want to help others. When they see a need, like a struggling family with a very small (or nonexistent) Christmas, they want to fill that need. That said, there is nothing precisely on point in the training that expressly prohibits this, but it might be strongly implied that this is an improper use of the Other Account.

For example, in the old Other Account training, it warns
Occasionally wards or stakes create an "Other" subcategory to collect funds for national or international charitable causes. While many such causes are noble and worthy, members should normally be encouraged to contribute to the Humanitarian Aid or Fast Offering funds, not the "Other" category. This allows the funds to be carefully administered and used for the maximum benefit to those in need.
Although the Holiday account is spent locally instead of sent to a national cause, the principle seems to be the same. If the goal is to assist those in need, the right category is Fast Offerings or Humanitarian Aid, not a Holiday account. Otherwise, it turns into a petty cash fund, and that's completely outside policy.

As an example, consider the ramifications if the "Christmas Account" is somehow overspent. Because the deficit wouldn't come from money owed by members, the proper course of action would be to transfer money from the Budget to cover the deficit. Now you have Budget funds essentially going to go for gifts, etc. for a particular family. Does this strike you as proper?

Note: I am not a grinch. I applaud the caring and generous spirit of those who would like to help others. I just don't think the Other account is a good way to do it. A Christmas list kept by the bishop, where particular needs are identified (i.e. toy for 4-5 year old girl, modest tree, Christmas goose, etc), and the individual members generously fulfill those needs, and the Bishop/Relief Society President then goes out and delivers the results, might be one way of helping others, and at the same time allowing the members to know exactly what was spent without knowing the identity of the recipients. But just contributing cash to an Other account has too many problems and not enough checks and balances to work well. At least in my opinion.

davesudweeks
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Postby davesudweeks » Tue Nov 29, 2011 12:00 pm

allenjpl wrote:A Christmas list kept by the bishop, where particular needs are identified (i.e. toy for 4-5 year old girl, modest tree, Christmas goose, etc), and the individual members generously fulfill those needs, and the Bishop/Relief Society President then goes out and delivers the results, might be one way of helping others, and at the same time allowing the members to know exactly what was spent without knowing the identity of the recipients. But just contributing cash to an Other account has too many problems and not enough checks and balances to work well. At least in my opinion.


This is the method I would advise. My family has done this in the past:
Contact the Bishop for gender/ages/clothing sizes of a needy family.
We purchase the gifts and wrap them.
We deliver them to the Bishop for him to have distributed.

As the Ward Clerk, I am in the meetings where family needs are usually discussed, but it is good for my children to sacrifice for someone they do not know who can benifit. Also, having them involved with finding/making the gift is better than their parents just donating cash.

Just my 2-cent's worth...

lajackson
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Postby lajackson » Tue Nov 29, 2011 1:32 pm

atticusewig wrote:A few things to note:

1) Other/AMFA payments will not show up on the Tax-valid statement as they are
usually used in a pass-through taxable manner, so be sure the donors know
that if they give a sizable amount they might need to generate their own
paperwork at tax time.


Under the current US Tax Code, donors are no longer allowed to generate their own paperwork and use it for a tax deduction. And, as you mentioned, any contribution of this type through AMFA will appear as a non-charitable contribution on the statement the Church gives the member in January.

So, as worthy as it may be, this will not be a charitable contribution as far as the US IRS is concerned.

dcurtis
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Donating in kind doesn't preserve anonymity

Postby dcurtis » Mon Feb 27, 2012 1:39 pm

allenjpl wrote:Bishops are, by and large, friendly folk who really want to help others. When they see a need, like a struggling family with a very small (or nonexistent) Christmas, they want to fill that need. That said, there is nothing precisely on point in the training that expressly prohibits this, but it might be strongly implied that this is an improper use of the Other Account.

For example, in the old Other Account training, it warns Although the Holiday account is spent locally instead of sent to a national cause, the principle seems to be the same. If the goal is to assist those in need, the right category is Fast Offerings or Humanitarian Aid, not a Holiday account. Otherwise, it turns into a petty cash fund, and that's completely outside policy.

As an example, consider the ramifications if the "Christmas Account" is somehow overspent. Because the deficit wouldn't come from money owed by members, the proper course of action would be to transfer money from the Budget to cover the deficit. Now you have Budget funds essentially going to go for gifts, etc. for a particular family. Does this strike you as proper?

Note: I am not a grinch. I applaud the caring and generous spirit of those who would like to help others. I just don't think the Other account is a good way to do it. A Christmas list kept by the bishop, where particular needs are identified (i.e. toy for 4-5 year old girl, modest tree, Christmas goose, etc), and the individual members generously fulfill those needs, and the Bishop/Relief Society President then goes out and delivers the results, might be one way of helping others, and at the same time allowing the members to know exactly what was spent without knowing the identity of the recipients. But just contributing cash to an Other account has too many problems and not enough checks and balances to work well. At least in my opinion.


The problem is, if the bishop says gifts are needed for a 4 year old girl, a 7 year old boy, and a 13 year old girl, it would be obvious in my ward which family the gifts were going to. When only 1 or 2 families need help, specifying ages without names doesn't mask who it is that the presents will be ear-marked for. For that reason, I don't see how the bishop can tell members what presents to buy without breaking confidentiality.

dcurtis
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Postby dcurtis » Mon Feb 27, 2012 1:45 pm

crislapi wrote:Many wards do a sub-for-santa fundraiser at Christmas time to help make Christmas possible for disadvantaged families using this same mechanism. The bishop can authorize the use of the Other account. So long as the funds are collected in a manner that is approved (not solicited), I would think this is a great way for these families to celebrate Christmas. This is something they could do on their own, but I think the bishop is in a much better position to know who would benefit the most so it makes sense to do this through the him.

If they truly want to be anonymous, be sure to assign the donations to "anonymous".


What I see often is members wanting to be anonymous that give cash directly to the bishop to be spent for Christmas for whatever families he feels are needy. That seems somewhat dangerous, since there is no accountability anywhere over how or if those funds are spent. But most of us trust our bishops, and it seems like a nice way to go that makes it easier to make and distribute purchases without all the extra accounting and paperwork. Because of that, it seems to be a common practice in many wards. Are there any policies that we should teach that would discourage this common practice?

jdlessley
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Postby jdlessley » Mon Feb 27, 2012 6:53 pm

Any donations given to the Bishop that is not handled in accordance with Church procedures (entered into MLS, etc.) is not a charitable contribution and is not given to a charitable organization, the Church. Funds given to the bishop outside the charitable umbrella of the Church becomes liable to the laws governing gifts to individuals and could, based on applicable law, be taxable to the bishop.

The Church's guidance for donations can be found in Handbook 1, Stake Presidents and Bishops (I do not have the specific reference on hand.).
JD Lessley
Have you tried finding your answer on the LDS.org Help Center page or the LDSTech wiki?


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