Bitcoin Forum

Thanks to MemoryDealers for this great idea!

ANY charity can now accept bitcoin donations quickly, and easily!  Here's how

https://bit-pay.com/forCharities.html (https://bit-pay.com/forCharities.html)

1. The donor receives a receipt for their tax purposes, which shows the bitcoins paid and the value of the donation.

2. The charity receives USD into their bank account, along with an itemized report of all donations.

3. A unique bitcoin address is created for each transaction, verifiable in the block chain.

But wait, how are bitcoins tax deductible?  Huh?

The reality is that anything with value can be tax deductible.  Bitcoins are actually much easier to establish a value for than furniture, clothing, food, blankets, and all the other items that charities accept every day.  Bitcoins have a specific value in Dollars, Euros, Pounds, etc, which is created by the exchanges.

Any charity that accepts credit card donations pays a processing fee to the credit card companies.  For example, using a "rewards" type card to make a $10 charitable donation, the organization pays 10 cents plus 3.5%.  In other words, for a $10 donation paid with a credit card, the charity only receives $9.55.

Bitcoins can reduce the processing fees tremendously!

And here's the bonus, only from Bit-pay.

If the charity is registered with the IRS Publication 78, Bit-pay will process the payments at NO CHARGE.

http://www.irs.gov/app/pub-78/ (http://www.irs.gov/app/pub-78/)

You must be on the IRS Pub78 list as eligible to receive tax-deductible donations to qualify for the no-charge processing.

So spread the word!  Tell every charity you know that they need to accept bitcoins!  It can't possibly be any easier or cheaper than this!!

Great!  Do charities have the option of automatically converting their bitcoin donations into USD with this?  If so, then perhaps this could alleviate the EFF's concerns about accepting bitcoin donations?

Yes, we will convert the bitcoins to dollars for them immediately, and send them the funds every business day by ACH.

Would the EFF technically be the owner of the bitcoins for the short time prior to their sale on the exchanges?  Is there any way it could be done so that the donor maintains ownership until after conversion into USD?  Or would this require the donor to have an account with bit-pay?  It would be great if charities could remove themselves from all risk due to legal uncertainty surrounding bitcoins.

With the way our system is setup, that may not be necessary.  The bitcoins are held by bit-pay (payment processor) then turned over as US Dollars to the Charity.

It works exactly the same way if a charitable donation is made with a Visa card.  Visa (payment processor) has the funds for a very short period of time, then they are sent to the Charity.

With our system, the charity receives the donation into their bank account as US Dollars.  It's much easier to place a value and sell bitcoins than it is to sell some furniture, for example, that people donate to charities all the time.

Okay, so I assume that because it's not a problem with donations via Visa, that although bit-pay is technically the recipient of the donation, it is still tax deductible?

Great job!

Just a thought: bitcoinsforcharity.org had an option before where people could contribute computer hashes to charity. The browser-based miner they used, Krad miner, has since gone off-line, but there is another Webcl-based miner run by http://www.coined.com online. Perhaps you could add an option to let people mine bitcoins for charity via their browser..

Correct.  The receipt has the name of the charity and the name of the donor.  That is what the donor needs for their taxes.  The process works exactly the same as making a charitable donation with Visa, or Paypal.

the browser-based CPU mining is no longer efficient.  But anyone mining coins, however they mine, can donate those bitcoins to the charity of their choice.  The charity must get setup with bit-pay. If the charity does not, send them this link and tell them they need to accept bitcoin donations!

https://bit-pay.com/forCharities.html (https://bit-pay.com/forCharities.html)

This is actually not a CPU-miner, it's a GPU-miner, and it's almost as efficient as a client-based miner.


Noted.

Awesome!

When the charity signs up, I notice they go to the default "merchant" sign up page. Is there a step where they indicate whether they're a charity?

Their status as a Charity will be indicated by their EIN.  If they are not registered with the IRS as a charity, then we would treat them like a traditional merchant.

Okay - make sure that's placed out front during the sign up process so charities understand. Otherwise, they'll think they're accidentally signing up as a "merchant" because all the wording is currently geared toward that.

We can do that.  But Visa & Mastercard refer to Charities as Merchants.  It's a generally accepted term for anyone who takes payments, whether you are a corporation or a non-profit.

 

Great concept! I actually know the operator of a small charity in my area... I'm going to have to point him your way and see what he thinks!

Wow, great work. This is amazing. Pretty much takes out all the negatives that could possibly come with donating via bitcoin (too much work for the charities, possibly not accepting, reduced value of the donation) and transforms bitcoin into the absolute smartest way to receive donations. I could really see this catching on and improving the image of the "BTCommunity" greatly. Thank you!

EDIT: Should we keep track of which charities have been asked to add bitcoin to their accepted donations? It wouldn't be good if everyone got the bystander effect and said someone else will do it or if everyone spammed the foundation at the same time.

Excellent idea.  There should be a section created in the Wiki for Charities.

More than 1 person asking the same charity is ok, because it gives them a better sense of demand.  Don't spam, just contact charities you already know. 

Tell them you want to make another donation but you only want to use bitcoins!   That will get their attention.

and yes, when you look at all the factors, we think it's a no-brainer for charities to accept bitcoins.  :)

I know political parties aren't charities but there are some similarities.

A previous thread had described how Bitcoins couldn't be used in the U.S. for donations to a political party because anonymous donations (over $50 USD) aren't allowed due to federal regulations.  Corporations are a "restricted" class and they are prohibited from making donations directly to candidates thus with anonymous donations there is no way to know the funds weren't a corporate donation.

http://bitcointalk.org/index.php?topic=5280.msg77304#msg77304

Each state makes their own rules for state and local elections so there could be some areas where anonymous donations are allowed:
 - http://www.politico.com/news/stories/0811/60594.html

I wonder if there would be some method though where bitcoins could be accepted through Bit-Pay and then donated in whatever manner is allowed.

What do you need for, or what are your existing plans, to expand outside of the US?

It's definitely on our plan.  To do it right, we need a legal company and a bank account in every country we want to do business in.  So that will take some time.

However, for transactions under $ 1000, and if the merchant is ok with taking the bitcoins straight-up, we can help them today!

Interesting!

1)Both wikileaks and the EFF do not take donations in bitcoin....HINT HINT HINT
2)The charity has liability for what happens with bit-pay...but bit-pay is the same as Visa right? LOL.
3)Someone should read about the record keeping requirements for a charitable contribution.

Im not listing all the problems with your scam.

No scam here, nighteyes.   Charities so far haven't accepted bitcoins because they could not make use of them as bitcoins.  Not every charity operator has the time or the skills to operate a trading account.  Now that the donation can be quickly converted to dollars that the charity can actually use, bitcoins become a viable option.  Regarding recordkeeping, it is up to the donor to keep track of their cost basis for tax purposes.  All they get from the charity, or from bit-pay, is a receipt for the donation.  But with a unique bitcoin address, the transaction can be verified in the blockchain.

https://www.eff.org/deeplinks/2011/06/eff-and-bitcoin

"1. We don't fully understand the complex legal issues involved with creating a new currency system
2. We don't want to mislead our donors.
3. People were misconstruing our acceptance of Bitcoins as an endorsement of Bitcoin."

So no, it wasnt because they could not make use of them.

#2 for record keeping, giving an IRS agent a unique bitcoin address will not satisy the record keeping requirement. You need either a bank withdrawl or payroll deduction. No charity should be authorizing deductions if they dont know who actually gave it. And even if the IRS gave you that point(they wont), good luck explaining the 'verification' in the blockchain. Just wait until someone says they gave $500 and you say it was $100 and start explaining blockchains and bitcoin to the charity.

It is possible to send bitcoins to charity, just not that way. I proposed a 501c3 charity that will accept the bitcoins that will then restrict that donation to be used for the donor purposes...however, there is the issue of the board of directors...and also an open transaction/books system, where the open-source computer program does the transfering without humans....granted I was told the open books system is impossible and probably will be hacked anyway.

Not exactly.  If the charity gives you a receipt, that is proof enough.  I donate to a local charity all the time.  Save every receipt, and add them up at the end of the year. 

It's too early for EFF.  Charities didn't accept credit cards at first, and then they did.  Charities didn't accept Paypal at first, and then they did.  If EFF says no, ok, there are plenty of other charities out there that will love the benefits that bitcoin offers.

According to my tax adviser, you only need a receipt from the charitable organization for cash donations.  For donations of property where you declare a value, you also only need a receipt if it's $5000 or less.  If it's over $5000, then an appraisal is required.  If anyone donates more than $5000 using bitcoin, you might consider getting a letter ruling from the IRS (or just sell the bitcoins and give them the cash and avoid the hassle).

Edit: but don't trust me, it's all right here: http://www.irs.gov/newsroom/article/0,,id=106990,00.html

yes, if you get the receipt...which they are not suppose to hand out if they dont know who the donor is. The charity by law must keep record of the source of donations. A terrorist cant give $1 million confidentially to AlQCharity#5 without any records....nor can you just type in someone else's credit card# for your donation....well thats how its supposed to work. Bitpay saying who the donor is not going to cut it either.

As I said, wait until there is a dispute....but then again, maybe there are some charities willing to put their 501c3 status on the line to accept bitcoins through some payment processor.

I did look at a site, http://www.bitcharity.org/#addresses, which claims a bitcoin address for Amnesty International....which seems like their(bitcharity) address that who knows what happens after that. I didnt see a 501c3 listed there for the direct donations. Freedombox doesnt have any records on the foundation lookup(it doesnt claim to be a 501c3 either)...http://bartlett.oag.state.ny.us/Char_Forms/search_charities.jsp

I think you are missing the point.  The vast majority of charitable donations are in the $10-$100 range.  You can't do anything large with bitcoins right now anyway, without crashing the market in some form.

The charity can collect the name and address of the donor to put on the receipt.  Perfectly acceptable.

- If the charity views the bitcoins as cash, ok, then offer a cash receipt.
- If the charity views the bitcoins as property, ok, then offer a receipt with the cash value.

There are literally tens of thousands of charities out there, where our feature is perfectly acceptable for small donations.  Let's talk to them. 

I think you are misinformed.  Anonymous donations are quite common (at least in the US).  The ability to make truly anonymous donations using bitcoin might actually be a highly desirable feature.  All the IRS cares about is that you can prove that you actually made the contribution that you claimed on your tax form should they decide to audit you.  Half the time that I've donated, the charity gave me a blank receipt and let me fill it out.  And, as far as a receipt goes, just about anything goes...the IRS has no standard form for such receipts.

I can't comment on bitcharity.org, but one thing you could do is inform the charity of any donations to those addresses (and the charity themselves could monitor transactions to those addresses).

http://wikileaks.org/support.html

I disagree that tax-deductible anonymous donations are quite common. Sure anyone can accept bitcoins, but to meet the IRS rules, either the deductor or the charity have to have records. As far as a charity handing out blank tax deductible donation receipts, that wont work with the IRS where you just fill in the amount and they accept that position. I'll admit not all businesses know all regulations, and not all filings and records are in proper order. But if you look at the rules set out, they dont entitle anonymous tax deductible donations.

I think you are creating a problem where none exists.  Charities know the rules.  Donors know the rules.  We're giving them another way to transact.  Let's be productive and talk to the charities where this can be helpful.

Anonymous donations are very common.  You are correct that either the person claiming a deduction or or the charity needs to have records.  I think you're confusing anonymity and record keeping.  As far as the IRS is concerned, they only care that you can prove to them that you made the donation (the proof can be in many forms and is only actually needed should you get audited).  The charity does not have to know who made the donation.  In fact, my previous employer allowed donations through payroll deduction and you could select an option to remain anonymous.  Obviously, the employer would know who made the donation, but the charity would not.  And those donations are definitely tax deductible.

Congratulations on the improvements. Maybe you should get a section at your website for announcements? I see the Press/Media section there, but it doesn't have any info on opencart/charities.

They are written and will be published with the next update.  Man, you guys can't let us catch our breath!  LOL

It's tough to provide a service because people always want more and more (and sometimes they want something and when they get it they realize they really didn't need it after all). Anyway, it was just a suggestion. Take your time ... 8)

These guys are promoting sound money. Their donation page could use a some bitcoin flare.

http://econstories.tv/donate/

We have a 501(c)(3) organization now accepting Bitcoin donations with Bit-Pay.

http://templeoftantra.org/ (http://templeoftantra.org/)

We have verified their status with the IRS and Bit-Pay will process all Bitcoin donations free of charge for the charity!

Your payment page looks pretty good. I hadn't seen it until now.

seriously?  http://www.cnn.com/2011/US/09/09/arizona.church.prostitution

WikiLeaks does ... http://wikileaks.org/Donate.html

.

Wow, that's serious religion prosecution

I wonder why that doesn't happens when christians go around asking "stop teaching evolution to kids" and idiocies like that... no wait, i know why...

Thanks to Anthony at Bit-Pay, Subud CA at San Diego (http://subudsandiego.com/) can now accept BTC donations by posting signs ( draft version at http://dl.dropbox.com/u/16538039/bitcoinsign.pdf ) and sending fundraising emails with the QR code that would have otherwise just been on a single card.

If I didn't just have BTC0.00728 at the moment, I would send my own test payment.

Just a warning to fellow non-profits who have provided documentation, it looks like our status may have been switched to merchant, so fees are now erroneously incurred.

ETA 6-25-13: We just got a fee refund, but ~100x what the refund should have been ($0.10 USD, not 0.1 BTC)  ???
ETA 6-29-13: Issue resolved, I think.

This may have happened when we reduced the fees from 2.69% to 0.99%.  if there are fees on your account please open a support ticket at support@bitpay.com and make sure you include the email address registered on your bitpay account.

I don't believe that that is correct. I've worked the charity side of audits a number of times and the auditors always insisted that the charity have a record of who made the donation for their tax purposes. I'm not saying this is definitive but it's always been the case with charities that I've worked with.  I'd recommend that you talk with a reputable non-profit audit/tax firm to be clear on the rules. It's a generous offer, but please make sure you have your i's dotted and t's crossed.