Handling charitable donation as a discount on an invoice

[R. Victor Klassen]

I think the way *I* would handle this would be to create the invoice for the full amount, and then when you post it to accounts payable, you have the full amount.

You can then pay it partly from the appropriate asset account, in the amount that you do - the $900.  And pay the other $100 from income/revenue-in-kind.  I haven’t tried this, but if it doesn’t work, you could pay the last $100 from assets/in-kind-holding-account (or some such) and then pay from income/revenue-in-kind into assets/in-kind-holding-account.   Which I know will work.

A feature of this approach is that if you ever lose this supplier (in this case engineer), your accounting will already show $1000 spent on engineering, which it should.  You really did spend $1000 on engineering, but you also got $100 in a donation.   Whether this complicates or simplifies your tax reporting likely depends on your jurisdiction.

On Dec 1, 2014, at 10:56 PM, edstrom <johnedstrom at firebare.org> wrote:

> Hi,
> 
> I have a similar problem and I'm wondering if there isn't a better way to accomplish this.
> 
> For example, one of our engineers that we deal with will bill us, say, $1000 for some job and give us 10% discount as a non-profit station.  So we pay him $900 to the engineer (expense:profession fees:engineering) in the standard way and then have to book the other $100 as an in-kind donation (income/revenue:in-kind).  At year's end it'd be good to be able track expenses and in-kind donations together by vendor in reports.
> 
> Normally this is done by splitting a transaction by hand as suggested above, but then its hard to sort these split up transactions by contractor at year's end.
> 
> Is there a somewhat accessible way (short of changing code & recompiling) to configure the list of available accounts to which an invoice payment can be charged?  It seems like all that's needed here would be to add 'income:donation:in-kind' to the list of allowed payment accounts.
> 
> 
> JE
> 
> On 10/27/2014 11:51 PM, Maf. King wrote:
>> Hi Kevin,
>> 
>> I've had a thought about this.  Write out your invoice, but put details about
>> the donation without specifying an account or sum of money - so just use the
>> description field for a line or two.
>> 
>> this will mean the invoice is posted showing the full amount owing.
>> 
>> Process the payment in the usual way for the full invoice value.  Then go into
>> the checking account and manually add a split to the payment transaction and
>> split $100 off to expenses:whatever  (ie Assets A/R remains, reduce bank and
>> add a new split)
>> 
>> HTH,
>> Maf.
>> 
>> 
>> On Mon 27 October 14 21:37:34 Kevin Wilson wrote:
>>> No other suggestions on this? Darn.
>>> 
>>> On 27/10/2014 8:23 AM, Kevin Wilson wrote:
>>>> Thanks Mike. I understand what you're saying, but in this case the
>>>> invoice was issued and paid way back in January, so I have to deal
>>>> with it as-is.
>>>> 
>>>> Kevin
>>>> 
>>>> On 27/10/2014 5:48 AM, Mike or Penny Novack wrote:
>>>>>> Is there a way to post a charitable donation directly to an expense
>>>>>> account from an invoice, or am I barking up a dead tree?
>>>>>> 
>>>>>> Kevin
>>>>> 
>>>>> Need to separate "can do" from "advisable" and this is something you
>>>>> really should be taking up with your accountant.
>>>>> 
>>>>> This is something I deal with all the time from BOTH sides of the
>>>>> question (sometimes as the donor and sometimes as the treasurer of
>>>>> the charity). It is really a LOT cleaner if you don't combine and
>>>>> provides a more definite record for tax purposes.
>>>>> 
>>>>> I am NOT an accountant, but I recommend you don't combine. Bill the
>>>>> invoice for the full amount and include a check for the donation you
>>>>> wish to make. Similarly when one of my people sends in a receipt with
>>>>> a  reimbursement request for only part of that (part they wish to
>>>>> donate) I send them a reimbursement check for the full amount and ask
>>>>> them for a check in the amount they wish to donate.
>>>>> 
>>>>> Michael
>>>>> 
>>>>> 
>>>>> PS: I will repeat, I am neither an accountant nor a tax advisor. This
>>>>> is really a question where you should know the answer in terms of the
>>>>> tax codes of your jurisdiction and what verification of donations
>>>>> they require.
>>>> 
>>>> _______________________________________________
>>>> gnucash-user mailing list
>>>> gnucash-user at gnucash.org
>>>> https://lists.gnucash.org/mailman/listinfo/gnucash-user
>>>> -----
>>>> Please remember to CC this list on all your replies.
>>>> You can do this by using Reply-To-List or Reply-All.
>>> 
>>> _______________________________________________
>>> gnucash-user mailing list
>>> gnucash-user at gnucash.org
>>> https://lists.gnucash.org/mailman/listinfo/gnucash-user
>>> -----
>>> Please remember to CC this list on all your replies.
>>> You can do this by using Reply-To-List or Reply-All.
>> 
> 
> 
> _______________________________________________
> gnucash-user mailing list
> gnucash-user at gnucash.org
> https://lists.gnucash.org/mailman/listinfo/gnucash-user
> -----
> Please remember to CC this list on all your replies.
> You can do this by using Reply-To-List or Reply-All.