Reference no: EM131417953

Imagine that the members of your class work as interns for a local nonprofit organization that works with parents to teach expressive skills to autistic toddlers. The organization has received several financial and automobile donations in response to a recent fund-raising drive, and it needs to send a form letter to donors that thanks them for their generosity and subtly encourages them to give again in the future. Because some donors have asked how they can write off their car donations, the organization has decided to supplement the letter with an information sheet that explains how to deduct noncash contributions from their income taxes. Create a thank you letter and an information sheet as follows:

a. For the letter:

• Create a name and letterhead for the charity
• Begin with the donor's inside address and a salutation with the donor's name.
• Write the letter using "we" or "I" viewpoint.
• Thank the donor for the contribution to your charity and detail the amount donated.
• Describe the good works of the charity (who is helped by the charity and how).
• Let donors know that because no goods or services were exchanged, the donation is tax-deductible and they should keep this letter for their tax records.
• Provide a contact name and number.
• Use your name to sign the letter as the director of the charity.

b. For the information sheet, use the following information paraphrased from the IRS Web site. Be sure to organize it logically and attractively and use the "you" viewpoint.

• If a donor claims a deduction on his or her return of over $500 for all contributed property, the donor must attach a Form 8283 (PDF). Noncash Charitable Contributions, to the return.
• If a donor claims a total deduction of $5,000 or less for all contributed property, the donor need complete only Section A of Form 8283.
• If a donor claims a deduction of more than $5,000 for an item or a group of similar items, the donor generally needs to complete Section B of Form 8283, which usually requires a qualified appraiser to appraise the vehicle and its value.
• The donor will need to keep records of the donation and substantiate the car's current fair market value. The charity will need to provide written acknowledgment (a description of the car and whether the charity provided any goods or services in exchange, including their value) if the donor is claiming a deduction of $250 or more for the car.