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Q&A: How Should My Church Handle a Donation of a US Savings Bond?

The church may not issue a charitable contribution receipt.

Frank Sommerville, Attorney, CPA
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Q: I just recently received a donation of a US Savings Bond. I have been a church administrator for 30 years and have never processed such a donation. What do I need to know in order to accept this contribution and issue a receipt?

US Savings Bonds are nontransferable. This means that the owner may not donate them to the church. The church may not issue a charitable contribution receipt because the donor does not have the power to transfer the bond to the church. As a result, the church did not secure ownership of the bond. Without an ownership transfer, there is no deduction. If the donor wants to have the savings bond reissued in the name of the church, the donor must cash the bond. The donor then must recognize the interest income at the time of the reissuance.

Frank Sommerville is a both a CPA and attorney, and a longtime Editorial Advisor for Church Law & Tax.

This content is designed to provide accurate and authoritative information in regard to the subject matter covered. It is sold with the understanding that the publisher is not engaged in rendering legal, accounting, or other professional service. If legal advice or other expert assistance is required, the services of a competent professional person should be sought. "From a Declaration of Principles jointly adopted by a Committee of the American Bar Association and a Committee of Publishers and Associations." Due to the nature of the U.S. legal system, laws and regulations constantly change. The editors encourage readers to carefully search the site for all content related to the topic of interest and consult qualified local counsel to verify the status of specific statutes, laws, regulations, and precedential court holdings.

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