giftinkind

Gift in kind, sometimes written as giftinkind, refers to the donation of goods, services, or other non-cash assets to a recipient such as a nonprofit organization, school, or relief agency. Unlike monetary gifts, in-kind gifts consist of tangible items (for example clothing, equipment, or food) or professional services provided at no charge. They are used to meet specific needs when cash would be less effective or when the donor possesses items that are useful to the recipient.

Common sources include individuals, businesses, and government programs. In-kind gifts are often coordinated by charities to fulfill particular programs or projects and may include equipment, books, supplies, or volunteered professional time. The value of an in-kind gift is generally based on the fair market value at the time of donation, which can influence tax deductions for the donor and accounting treatment for the recipient.

Valuation and documentation are important aspects. Donors may require appraisals for high-value items; organizations should document a description of the donated item, its condition, how the value was determined, and any limitations on use. In many jurisdictions, in-kind gifts are recorded as revenue or charitable contributions at fair value and may create corresponding asset entries for the recipient, which may be depreciated over time if they are capital assets.

Advantages and challenges include providing immediate access to needed goods or services, aligning with the donor’s capabilities, and potential tax benefits. Challenges can include valuation complexity, storage or logistics requirements, and potential mismatches between donated items and actual needs. Regulations governing deductibility and reporting vary by country and region. See also in-kind donation and non-cash donation.