Best Practices When Preparing Tax Summaries

Overview

There are a handful of tips to follow when you're creating tax summaries to send out. Read through the following steps to make sure you efficiently send accurate tax summaries for your donors.

Linked Articles: 

- How to Send Tax Summaries Using Kindful's built-in Tool

- Tax Summaries Tool – FAQ

- Generating Year End Tax Summary Letters (for mailing)

Tips

1. Make sure all donations for the year are logged in Kindful.
   Use the import tool to import gifts stored in other systems. If you use fundraising platforms like CrowdRise, you can import these directly by going to the App Directory and connecting the applications.

Learn more about importing data using the Data Import Tool here.
Learn more about connecting other applications to Kindful here.

1. Verify your organization’s details are correct in Kindful.
   Go to Settings, and check Basic Settings and General Settings.

1. Access and clean up your data.

• Do a quick export of people that have donated this year. Go to Contacts and type in the filter bar “Has Transaction in Year”, then enter the year for which you’re sending tax summaries. For example, to find people that donated to your organization in 2017, the filter will be “Gave in Year: 2017”. You can then select Create Report on the right sidebar, choose what data you need (name, address, etc) and export as CSV. Scroll through the document to make sure names are spelled correctly and addresses look accurate.
• Buy an NCOA Scrub from Kindful to make sure more mailing addresses are accurate and deliverable. You can email support@kindful.com to request pricing on an NCOA Scrub.

1. Merge duplicate contacts.
   Use the Contact Duplicate Finder to merge potential duplicate contacts. Learn how to use the Contact Duplicate Finder here.

1. Use householding correctly.
   Take time to understand how householding is set up with your organization. Those settings will impact how printed tax summaries are sent to individuals. Only the primary (head of household) record will have a tax summary created showing all donations for the household. This must be done when using the standard Mail Merge process to generate a year-end tax summary. Learn more about householding here.

1. Get the right mailing supplies.
   Order supplies, envelopes, paper, and labels. Kindful uses #9 size envelopes for tax summaries. -- include letter insert w/ Call To Action since they're already paying for postage.

1. Take advantage of this opportunity to engage with your donors!
   Include a thank you letter, tell a success story, and make another appeal for the upcoming year!

1. Set up the “From” email address.
   The from email setting is different than the reply-to address. Learn more here.

1. Check organization contacts.
   Check that all organization-type contacts have the intended donations attributed to their contact. To edit a transaction, find the transaction on the contact record or in Activities, select Edit on that transaction, and change the assigned contact.

U.S. Tax Logistics

• We recommend waiting until the 2nd week of January to generate and send tax letters. This way you can make sure all checks in the mail are received and processed correctly.
• If a donor gave $250 or more to your organization in a given year, you are required by law to send tax summaries to donors.