Cryptocurrency, also known as Virtual Currency or “Crypto,” is a digital asset designed to function as an alternative to sovereign fiat currency, e.g., US Dollars. Public, distributed ledgers, also known as a blockchain, verify transactions between two parties. While Bitcoin is the original cryptocurrency, and most widely followed, there are a number of cryptocurrencies currently available.
Yes. It is lawful for a nonprofit to accept a donation in the form of a cryptocurrency. On March 2014, the United States Internal Revenue Service (IRS) ruled that Bitcoin is treated as property for tax purposes (IRS Notice 2014-21).
We accept a variety of donation payment methods to make supporting the Good works of the Church as easy as possible. Cryptocurrency, as an asset class, joins other ways a donor can give to the Church, including check, credit card, debit card, stocks/bonds, mutual funds, charitable IRA transfers, charitable trusts, private foundations, real property, in-kind and tangible personal property, and donor advised funds. The Roman Catholic Archdiocese of Washington reserves the right, at our sole discretion, to decline donation offers for any amount, from any source, and for any reason.
The Roman Catholic Archdiocese of Washington immediately converts all cryptocurrency donations to cash, minimizing the risk of a donation significantly changing in value from the moment of the charitable transfer.
As with any form of electronic payment or transaction, there are risks. However, our vendor, Engiven, has created certain safeguards to ensure that the transaction is secure. With the transfer of cryptocurrency from donor to nonprofit, Engiven believes the transaction can actually be more secure than many other forms of payment, provided certain protocols are followed, such as:
1) By using the Engiven platform, both the nonprofit and the donor are required to undergo a simple but effective Know Your Customer (KYC) and Anti-Money Laundering (AML) screening which provides a high level of background security to ensure both parties are properly screened; and 2) As with any cryptocurrency transaction, when transferring your tokens to make a donation, do not expose or share your wallet’s private keys at any time.
The IRS considers cryptocurrency holdings as “property” for tax purposes, which means that gains and losses of crypto holdings as an investment for more than a year are capital in nature.
Transactions using virtual currency must be reported in U.S. dollars. Therefore, taxpayers will be required to determine the fair market value of virtual currency in U.S. dollars as of the date of donation. If a virtual currency is listed on an exchange and the exchange rate is established by market supply and demand, the fair market value of the virtual currency is determined by converting the virtual currency into U.S. dollars (or into another real currency which in turn can be converted into U.S. dollars) at the exchange rate, in a reasonable manner that is consistently applied.
Donors who give cryptocurrency donations will receive an electronic donation receipt, through the Engiven donation platform, in US dollars with comprehensive details about each transaction.
The Engiven platform is a third party vendor provided donation software technology that enables nonprofits to receive cryptocurrency donations safely and securely and then convert those donations into usable fiat currency such as US dollars.
No. The beneficiary parish, school, ministry or designated program receives 100% of the net proceeds (after the merchant transaction fee) of the donation.
Contact Joseph Gillmer, Executive Director of Development, at (301) 853-5375 or email at firstname.lastname@example.org. The Roman Catholic Archbishop of Washington (EIN: 53-0196550), dba The Roman Catholic Archdiocese of Washington, is recognized as a 501(c)3 tax-exempt organization.
The Roman Catholic Archdiocese of Washington and its affiliates do not provide tax, legal or accounting advice. Material on this website is prepared for informational purposes only, and is not intended to provide – and should not be relied on for – tax, legal or accounting advice. Please consult your own tax, legal and accounting advisors before engaging in any transaction.