Worksheet 8

Cash and In-Kind Contributions to Community Groups (Part I, line 7i)

Use Worksheet 8 to report cash contributions or grants and the cost of in-kind contributions. Do not include any contributions funded in whole or in part by a restricted grant, to the extent that such grant was from a related organization, as illustrated in the examples below.

"Cash and in-kind contributions" means contributions made by the organization to health care organizations and other community groups restricted to one or more of the community benefit activities described in the table in Part I, line 7 (and the related worksheets and instructions). "In-kind contributions" include the cost of hours donated by staff to the community while on the organization's payroll, indirect cost of space donated to tax-exempt community groups (such as for meetings), and the financial value (generally measured at cost) of donated food, equipment, and supplies.

Report cash contributions and grants made by the organization to entities and community groups that share the organization's goals and mission. Do not report cash or in-kind contributions contributed by employees, or emergency funds provided by the organization to the organization's employees; loans, advances, or contributions to the capital of another organization; or unrestricted grants or gifts to another organization that may, at the discretion of the grantee organization, be used other than to provide the type of community benefit described in the table in Part I, line 7.

Special rule for grants to joint ventures. If the organization makes a grant to a joint venture in which it has an ownership interest to be used to accomplish one of the community benefit activities reportable in the table, in Part I, line 7, report the grant on line 7i, but do not include the organization's proportionate share of the amount spent by the joint venture on such activities in any other part of the Table, to avoid double-counting.

Example 1. The filing organization (A) and foundation (B) are related organizations. B makes a grant to A that must be used by A to conduct a community needs assessment in a community served by A. A may report the cost of conducting the community needs assessment in Part I, line 7e, column (c) in the year it conducts the needs assessment, but A need not report the restricted grant from B in Part I, line 7e, column (d). The same result is obtained in B is unrelated to A, or if the grant is unrestricted rather than required to be used by A to provide community benefit.

Example 2. Use the same facts as in Example 1, except A may also use the grant from B to make a grant to another organization (C), which must be used by C to provide community benefit. A makes such a grant to C. A may not report the grant to C in Part I, line 7i, because it is funded by a related organization, but A need not report the grant from B in Part I, line 7, column (d) for any line 7 item. This is the result regardless of whether B and C are related organizations.

Example 3. A is a related organization with respect to each of B, C, and D. Each of the organizations files a Form 990 and a Schedule H (Form 990). A makes a restricted grant to B that is restricted to one or more of the community benefit activities described in the table in Part I, line 7 (and the related worksheets and instructions). A's grant is not funded by a related organization. B makes a restricted grant to C that is funded by A's restricted grant. C makes an unrestricted grant to D that is funded by B's restricted grant. Under these circumstances, A can report the grant to B on A's Schedule H (Form 990), Part I, line 7i, but neither B nor C can report their respective grants to C and D on Part I, line 7i of their own Schedule H (Form 990). If D uses the grant funds to make a grant restricted to one or more of the community benefit activities described in the table in Part I, D can report the grant on line 7i.