12 Feb Gift Agreement: How To Make A Gift Agreement For Your Nonprofit + Template
Creating a simple and straightforward experience for your donors is essential to building a strong, fruitful relationship with your supporters. There are many different ways to create a streamlined donation process for those who wish to support your nonprofit.
For example, text-to-give solutions make donating a cinch, especially when they have an easy-to-use interface for both donors and employers internally. Another tool that nonprofits can utilize to create a more consistent donor experience is through a gift agreement. Gift agreements are essentially a way for nonprofits and donors to stay on the same page regarding what the donor has agreed to donate on a continuous or rhythmic basis.
Like a pledge card, a gift agreement is also a great way to promote repeat donations, and creating one is relatively simple. Today we’ll be discussing what details to include in your gift agreement, and we’ve even provided a template to get you started! But first, let’s break down the purpose of gift agreements in their entirety.
The Purpose of Gift Agreements
Gift agreements are created to ensure an understanding between donors and nonprofits. For this reason, the goals of a gift agreement are as follows:
- Set clear expectations between the donor and the nonprofit.
- Provide sufficient documentation of the donor’s promise for donations in the future.
- Make it clear what the donor’s intention is with their donation.
- Spell out the specific and realistic guidelines that the nonprofit may use the gift for.
- Provide information on how the nonprofit may alter how they use the funds.
What to Include in Your Gift Agreement
There are different sections you can include in your gift agreement based on your specific needs. However, typically they will include the following three sections:
Introduction – Should simply outline which parties are involved in the agreement. Example:
This Gift Agreement is made this ____ day of _______ between [Donor’s Names], and [Your Nonprofit] a[n] [description of what your nonprofit is/does]. The Donor and [Your Organization] agree as follows
Donor Commitment -The amount the donor has pledged to give.
Donor Purpose – What the purpose of the agreed-upon gift will be used for.
Payment – A breakdown of the payments and which dates they will fall on.
Signature and Witnesses – Signatures for those involved in the agreement, as well as the date signed and any witnesses that are present.
After these initial sections, you can add any more sections that may be appropriate based on your agreement. Here are some examples:
Recognition by (Nonprofit Name) – Requires that to honor the donor, the nonprofit will mention them in news announcements and other media or marketing outlets, with the permission of the donor.
Reporting and Stewardship – Requires that the nonprofit provides updates on how the funds are being used and whether or not they are successful in achieving whatever goal the donor had in mind when they donated.
Additional Gifts – The donor reserves the right to increase their donations through additional gifts.
Future Changed Circumstances – Any circumstances in which the donation amount may change based on outside forces or unforeseeable circumstances.
Amendment – A section outlining whether or not amendments can ever be made to the agreement and which parties must be involved to make an amendment.
Morality Clause – If at any time the donor or his or her name may compromise the public trust or the reputation of the institution, including acts of moral turpitude, the institution with the approval of the board of trustees has the right to remove the name or return the gift.
Entire Agreement -Acknowledging that this agreement contains all the necessary information on the agreement. If there are any other documents that contain info on this agreement, include the names of those documents here and address who has possession of originals and copies.
Free Downloadable Gift Agreement Template
If you’re in need of a quick, simple, and easy-to-use gift agreement template, download this one for free! It’s editable to ensure you can include all the specific details between you and the donor.