Direct Mail

Donor Acknowledgement Letter

By 20 February 2024April 17th, 2024No Comments
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Donor Acknowledgement Letter: How to Draft Appreciation Letters for Your Donors?

An average person supports at least 4.5 charities, with 69% of Americans contributing to nonprofit purposes generously! Your charitable organization’s primary task is to reach out to donors and highlight why supporting your firm can make a difference. You may initiate this campaign by drafting an effective donor acknowledgment letter to help retain donors and increase brand awareness!

mail letter format

This letter serves various purposes, from providing donors with all the details to thanking them for their contribution. It allows organizations to establish personal bonds, get more donations, and function as a well-supported community.

But what is a donation acknowledgment letter, and how to write one?

Read on to learn more about this crucial donor retention tool that helps nonprofits form genuine, long-lasting relationships with potential and existing donors.

Let’s get started!

What is a Donation Acknowledgment Letter?

Typically, nonprofits must send an acknowledgment letter to donors who contribute $250 or more in cash or kind. It also serves as a receipt with all the necessary information, like the amount, date, name, etc. Donors can use these details to file their taxes accordingly after deducting a specific amount. 

However, an acknowledgment letter for donation also helps charitable firms thank their donors and show they are grateful. It makes donors feel special and helps encourage them to continue to contribute further.

Some nonprofits only send one donation letter for tax purposes at the year's end to acknowledge all the contributions donors made throughout the year. But, it is better to diversify your messages more and ship letters after every contribution to make donors feel that they made an impact on your firm. 

Reasons to Send a Donation Acknowledgement Letter

Below, we list the benefits and reasons to send acknowledgment messages to donors to help you understand their significance:

Acknowledges the Donation

It is crucial to inform your donors you received their gifts. This act assures them that their donations reached you successfully while also making them feel special.

Sending a personalized sample donor acknowledgment letter proves you care about your audience. It also demonstrates how your firm can go the extra mile for people who patronize their effort!

The donation details in the acknowledgment letter for donation allow donors to keep tabs on their gifts, get tax benefits, and make informed decisions.

Show Donors Their Contributions, Matter

Appreciating donors is not only a gesture of appreciation—it helps depict how much their donations matter to your organization. Sending a donation acknowledgment letter promptly after getting a cheque or gift helps you thank people who support your causes. 

Update Donors About How You Use Their Gifts

Donors would love to know how much their donations helped your nonprofit’s goals. For example, imagine you built a small learning center for children with the money you raised during the campaign. Or you fed a hundred kids on Thanksgiving. One of the goals of sending a donor acknowledgment letter is to tell them how they have been using the funds they collected.

To encourage donors to maintain their contributions, explain the purpose of the fundraising campaign and if it was successful.

Create Brand Recognition

An acknowledgment letter for a donation helps nonprofit and charitable organizations subtly create brand recognition among their target audience. Also, it gives donors something tangible to hold onto that can remind them to contribute to your firm again. 

Fulfill Legal Obligations

The IRS legally binds nonprofit institutions to send a donation letter for tax purposes to all donors who donate $250 and more. It must comprise the necessary information, primarily if you do not want to send a payment receipt separately.

Keep in Touch With Your Donors

A well-written donor acknowledgment letter lets you stay in constant touch with your donors. You can remind them about the causes you support, appreciate them for their donations, and improve brand recall—all at once!

Which Channel to Use to Send Your Donation Acknowledgement Letter?

Nonprofits can use many options to send their acknowledgment letters to donors, like

Email

Sending emails to thank your donors instantly after they contribute online or offline is quick and convenient. You may personalize your emails with the donor’s name and prepare an appealing donor acknowledgment letter to send them. 

But remember that the average person receives over a hundred emails daily! It is not surprising if the recipient ignores or mistakenly deletes your acknowledgment letter for donation, leading your effort to go in vain. 

Fax

Faxing your donation acknowledgment letter is an excellent idea unless your primary donors are individuals only. Most companies that donate have a fax machine at their workplace, making it simple for you to send them the letter if you have their fax number. 

Again, there is a disadvantage to using this channel—it is impersonal and less appealing. And it does not have the power to improve personal connections with people!

Direct Mail

Direct mailing your donor acknowledgment letter is your best bet because it enables you to speak to your audience on a 1:1 level. Getting letters in the mail creates a nostalgic feeling among people! You have better chances to make a difference via direct mail than email, fax, or other channels. 

Using PostGrid’s direct mail services, you can draft, print, and ship a donation acknowledgment letter to any number of recipients. We also have variable data printing, pre-built templates, mailing list verification, and other features to help you increase efficiency and save costs. 

What Elements to Add to When You Acknowledge a Donation?

You cannot draft acknowledgment messages for your donors the same way you write formal letters. Use a polite and personal tone, but keep it professional.

Here are the elements you must add to your donor acknowledgment letter to make it effective and responsive:

Your Nonprofit’s Name

Include the name of your nonprofit organization on the top by which your donors can recognize you. It is a legal requirement and helps your audience understand where the donor acknowledgment letter came from- allowing them to record their tax transactions accordingly.

The best way to add all the necessary information about your institution is to print the donor acknowledgment letter sample on your official letterhead. It already has your name, contact number, website, mailing address, etc.

Tax-Exempt Status

You must include a statement saying you are a 501c3 tax-exempt institution. Also, mention your EIN (Employer Identification Number) to allow donors to check your firm’s status whenever required!

Donation Date and Amount

Donors can apply for charity deductions yearly based on the total amount they contributed to nonprofits in one calendar year. Thus, add the donation date and amount to your donor acknowledgment letter to provide all the accurate details and declare the donation receipts from your end.

Description of the Gifts

If you run a nonprofit institution, you already know people donate in several ways, like

  • Stock donations: Donations in stock help increase the tax deduction and contribution value by 20%, making it a beneficial deal for both parties. If you receive stock donations, mention the same in your tax-exempt donation letter sample to establish clarity.
  • One-time and recurring gifts: 45% of American donors have enrolled in a monthly charity program. Hence, recurring donations are prominent, pushing nonprofits to differentiate between one-time and regular donors. Thank them accordingly in your donation acknowledgment letter to make them feel valued and get them to respond.
  • Pledge donations: Some donors, primarily corporate companies, pledge or commit to donating a specific amount to your organization. You can send a donor acknowledgment letter to thank them for their commitment at the start. Then, you may ship separate appreciation notes or postcards later after every installment.

Online donations, sponsorships, legacy donations, event attendance, etc., are other forms of contributions to a charitable organization. Your donation acknowledgment letter must have a short description of the contribution types you received from specific recipients to tailor your messages.

Mention Past Donations

You do not need to add the entire donation history of a person while writing them a donor acknowledgment letter because it kills the purpose of the message. Focus on one specific donation, but thank the recipients for their continued support over the months or years. It is an excellent way to express your gratitude and write engaging letters.

Some organizations only send one acknowledgment letter for a donation per person in a year. If so, it is advisable to include all the corresponding amounts and dates for all the contributions.

How to Draft a Donor Acknowledgement Letter the Right Way?

Below, we have mentioned how to structure your letter to make it look professional, elegant, and appealing to your donors:

Mailing Address

You must include your correct mailing address in every donation acknowledgment letter—to encourage people to write back to you. Also, mention the accurate postal address for every recipient to help the postal services deliver your letters to the correct people. Otherwise, you may face problems like lost envelopes, mail returns, misplacements, etc., causing a waste of postage, time, and effort. 

Date

Write the date when you write the acknowledgment letter for the donation, not when you send it. Try sending your letter promptly, for example, two to seven days after the person or company contributed to your organization. 

Tip: Try sending your donor acknowledgment letter to all donors latest by 31 January because some people file their taxes early. 

Subject Line

This element is optional because a donor acknowledgment letter is semi-formal. But, if you choose to write the subject line, mention phrases, including

  • Appreciation letter for a donor. 
  • Donor appreciation. 
  • Donation acknowledgment.

Salutation

Leave a line and write a personalized salutation with the appropriate title. Avoid using terms like “Dear Donor” or “Dear Reader.” It can make your audience feel that you did not put in the effort to write them a tailored donation acknowledgment letter, creating a negative impression. 

Introduction

Keep the introductory paragraph of your donor acknowledgment letter short and sweet. Thank your donors for their donations, explaining how you used their contributions. Try making this section as personalized as possible to grab your audience’s attention and showcase your firm as authentic and trustworthy. 

Body

You can elaborate upon everything you said in the first paragraph using the body of your letter. Try not to push your donors to donate again because it can give your donation acknowledgment letter a marketing appeal. 

Conclusion and Closing

Conclude your acknowledgment letter for donation by thanking the donors again. Be humble and show that you care about every contributor.

Toward the end, add your closing statement and a personalized signature that shows the letter came from a person, not an automated message-writing machine. 

Your closing remarks can include

  • Yours sincerely
  • Yours faithfully 
  • Kind regards
  • Warm regards, etc.

Donation Acknowledgment Letter Template and Samples

Find below a template to help you write your acknowledgment letter:

[Nonprofit name]
[[Mailing address]
[Phone number]
[Email address]
[Date]

[Donor’s name]
[Their delivery address] 

[Subject line]

[Salutation]

[Introduction- Enhance your relationship with your donors by appreciating their time and gifts. Lay the foundation for the rest of your donor acknowledgment letter, primarily if you want to announce something]

[Body- Talk more about your organization and how it has been helping people. Make donors feel good about their donations and that their money is in the right hands.]

[Conclusion]

[Closing]
[Signature]

#1 Charitable Contribution Acknowledgement Letter Sample

Letterhead

Date: 30 November 2024

Harry Miller
97 Rocky RD
Campbell OH 44405

Subject: Donation Acknowledgement Letter

Dear Mr. Harry, 

We are pleased for your continuous support of our nonprofit organization for the past five years. This letter is to thank you for your recent donations to the ‘Fight Against Cancer campaign.’ Here is a summary of your contributions since 1 January 2024:

    • 5 February 2024: $120
    • 16 April 2024: $80
    • 7 June 2024: $270 
    • 26 November 2024: $90

Donors like you help us function smoothly and aid thousands of families across America to get their lives back from cancer. We cannot express our appreciation for you enough!

Our charitable firm stands with every person who undergoes expensive chemotherapy sessions that mentally, physically, emotionally, and financially drain them. We work for the mission to fund their healthcare to do our bit to help them fight back against this deadly disease. Our institution is proud to announce that we have helped more than 500 cancer patients so far. And it would not be possible without your generous contributions. 

We thank you again for your kindness!

Yours faithfully,
Jules Garcia. 
[Signature]

#2 Example of Donation Letter for Tax Purposes

Serving America

12 Melody LN
Richmond VA 23225
Contact: +1 804 xxx xxxx
Date: 30 November 2024

To, 

Treta Pereira
75 2nd ST
Winchester VA 22601

Subject: Acknowledgement Letter for Donation

Dear Ms. Treta, 

We thank you for your generous donation of $280, dated 22 November 2024, at our auction. Your presence and contribution matter to us and the people we help. You have supported us since 2019, and we are deeply grateful to have you as a significant part of the Serving America family! Please find the attached payment receipt, which you may use to claim our tax deductions. 

Serving America finds and helps homeless families restart their lives in a better way. We enable their children to go to school, assist the adults in securing a job, and arrange a place they can call home. With your support, we extend our help to these people who cannot wait to enter this new, exciting chapter of their lives where they no longer have to rely on anyone. Serving America appreciates your kindness and thanks you on behalf of every family we have ever helped!

Thank you again, and have a lovely day!

Warm regards, 
[Signature]

Tips and Techniques to Write an Impressive Donor Acknowledgement Letter

You can employ many methods to make your donation acknowledgment letter more appealing and drive responses from your recipients. Here are some of the tips you can use:

  • Be Friendly and Warm: Use a pleasant tone to make recipients read your letter. You aim to form emotional bonds with your donors, which is only possible if you express your appreciation in a friendly way. 
  • Become donor-centric: Your acknowledgment letter for donation must have words and phrases like “you,” “your gift,” “because of you,” “your support,” etc. It helps make your message donor-centric and accomplish the purpose of sending it. 
  • Avoid jargon: Nonprofits may use industry-specific jargon regularly. But it does not mean they must use these terms in their donor acknowledgment letter because it can confuse readers. Try using simple language and short sentences to make your message more meaningful. 
  • Refer to the donor’s history: Never leave out the donor’s past donations in your donor acknowledgment letter because your donors must know that you remember them. It creates a positive impact, strengthening relationships and persuading donors to become regular contributors. 
  • Include real-life stories, imagery, and statistics: Add authentic images with your message and stories that depict your organization’s work. It makes your donor acknowledgment letter more trustworthy and adds value to your nonprofit activities. 

How Can PostGrid’s Direct Mail Services Help Nonprofits Send a Donor Acknowledgement Letter to its Audience?

PostGrid’s direct mail API and software can help nonprofit and charitable institutions conduct effective mailing campaigns to

  • Reach their target donors and encourage them to donate via fundraising letters
  • Improve brand awareness and reputation. 
  • Retain donors for years with thank-you postcards, event invitations, etc. 
  • Send an eye-catching and custom donation acknowledgment letter to recognize the reader's contributions and make them feel valued. 
  • Drive offline audiences to online channels where they can read more and contribute online. 
  • Inform donors about your works to showcase how you help society at large using their donations. 

It might not be hard to pen down a donor acknowledgment letter for your donors. But it is daunting to write thousands of letters, print them, and mail them to the correct addresses! 

PostGrid helps you reduce the legwork and focus on your fundraising efforts. It increases productivity, cuts manual work, and saves time and money. Thus, you can send your acknowledgment letter for a donation whenever needed without draining your budget. 

Our features include address verification, per-piece tracking, design templates, campaign insights, etc., but you have much more to explore! Click here to access our pricing plans and features, and send your donation acknowledgment letter today!

Also, below is what one of our clients in the nonprofit sector commented after working with PostGrid:

“This direct mail automation company helped us send over 5,000 mail pieces to connect with donors. The result was better than we expected- a 40% jump in the donation levels and a 20% increase in our followers on social media. PostGrid is a technologically-advanced tool that helps you transform snail mail into something powerful.”

Request a demo if you want to experience how PostGrid helps you send your donor acknowledgment letter quickly and affordably!

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