In the nonprofit world, writing thank-you notes is incredibly important for donor stewardship. But what should a thank-you letter include? And how should it be formatted?
In this article, we will explain how to write thoughtful and engaging thank-you letters for your donors. We will also provide nonprofit thank-you letter templates designed for various gift types to help you perfect your letters of appreciation.
Let’s get started.
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By definition, a nonprofit thank-you letter thanks a supporter for their gift and acknowledges the gift's receipt. Whether you send a handwritten note, a formal thank-you letter, or an email, it’s important to acknowledge every gift you receive.
For gifts of more than $250, the Internal Revenue Service requires a formal gift receipt and you can include the receipt as part of the thank-you letter (more on that below). Despite that legal requirement, it’s best practice in the nonprofit world to acknowledge every gift, no matter how small.
Who should write a nonprofit thank-you letter? That depends on the size of the gift and the size of your nonprofit organization.
One of the first things to consider is your major gift threshold. Doing so is simple. What are the largest gifts you’ve received in the past fiscal year? For some organizations, a major gift might be $500 or $1,000. For large nonprofits, a major gift could start at $50,000 or more.
Once you’ve determined that threshold, you can agree on thank-you protocols. For instance, you could have a policy that smaller gifts should be acknowledged with a personal letter signed by the development officer and that anything at or above the major gift threshold should be acknowledged by a letter signed by your chief executive officer.
Thank-you letters should go out as soon as the gift has been processed. The standard is a 24- to 48-hour turnaround between gift receipt and generation of the acknowledgement, whether that’s an email, a hand-written note, or a printed thank-you letter.
A thank-you letter doesn’t need to be a magnum opus—later in this article we’ll explain an easy format you can follow to create thank-you letters that will resonate with your donors.
Thank-you letters are a necessary part of good donor stewardship and saying “thank-you” is simply good etiquette.
Because of the IRS’s $250+ acknowledgement requirement, it stands to reason that nonprofits should keep ahead of that curve. Proactively providing gift acknowledgements to donors keeps them from having to shoulder the burden of asking you to provide them with such proof.
But besides legal requirements, there’s another reason why thank-you letters and notes are so important—if done properly, they help build a lasting relationship between your nonprofit and each one of your donors. This is especially true with first-time donors.
Donor retention is an ongoing issue—one study suggests that 41% of nonprofits struggle with retaining donors. Not receiving a “thank you” could offend both existing and first-time donors.
Donor loyalty and retention is essential to successful nonprofit fundraising. Thank-you letters are an important way to show your appreciation to donors and communicate how critical they are to your organization’s mission.
To keep your donors happy, you need to take good care of them—like thanking them often and sharing with them how their investment in your nonprofit has made a difference.
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How can you best communicate your gratitude to your donors? Here are 4 things you should include in a nonprofit thank-you letter:
A good nonprofit thank-you letter or note addresses the donor by their name and acknowledges both the monetary amount of the gift as well as the date your organization received it. That way, the donor feels seen and doesn’t get the impression that they are receiving a form letter.
We trust that in your donor management system, you’ve noted each donor’s naming preference. In other words, are they okay with you addressing them by their first name, or do they prefer a formal Mr., Ms., or Mrs.?
By using photos or infographics or even a short story, you can demonstrate the donor’s tangible impact and help them stay emotionally engaged with your work.
Most donors give because of empathy, so by sharing an impact story, you will keep the empathy flowing. Decide on what story you want to share and be sure to get signed permission from the client you’re featuring. If it’s a child, you’ll need to get their parent or guardian’s permission, too.
By acknowledging your gratitude sincerely, you will help establish trust in your nonprofit. Using flowery or too formal language can come off as insincere. Humbly expressing gratitude is much more believable and palatable.
The best nonprofit thank-you’s include some real estate (usually the bottom of the page) where a gift acknowledgement is included for tax purposes. This should always include the phrase “No goods or services were provided in exchange for your contribution” so long as that statement is true. This language is required by the Internal Revenue Service for monetary gifts of more than $250.
Still unsure how to write thank-you letters that will resonate with your donors? Try following this three-part nonprofit thank-you letter format:
1. Start With a Detailed Opening
Personalize the greeting and acknowledge the donor’s specific gift.
If the gift was unrestricted, mention your appreciation to the donor for supporting your general operations and how important unrestricted gifts are.
2. Make the Donor the Hero
After personally thanking the donor for their specific gift, begin a new paragraph that centers on the impact of said gift. Make sure that you don’t focus on how great your organization is. Instead, make the donor the hero. Tell them exactly how their gift will or has already made a difference. Sharing an impact story is a great way to do this.
Also, consider adding a call to action such as an invitation to visit your program or to volunteer. (And don't ask them to make another gift in this letter.)
3. Close with a Warm Thank You
Close your letter by thanking them warmly. You should also end your letter by providing the required gift receipt they can use for tax purposes toward the bottom of the page.
Some Added Tips:
In certain cases, it can also make sense to offer your donor a gift as part of your thank-you process. These can range from a bumper sticker or a mug to something much fancier for a major donor. Check out some great ideas in this nonprofit donor gift guide.
You should also make sure to always run spell check before finalizing your letters. And you might want to run your copy through the Hemingway App to tighten up your prose.
Different types of gifts might need different kinds of thank-you letters. Let’s spend some time looking over 7 thoughtfully crafted nonprofit thank-you letters for different types of gifts to inspire you.
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This is a great example of a nonprofit thank-you letter template. It's addressed to a couple who has donated to the annual fund of a fictitious nonprofit in Pennsylvania. Instead of telling a story, the letter offers an overview of the Center’s services and longevity.
Note the small print at the bottom of the page which allows this letter to also serve as proof of donation for tax purposes. Also notice the call-to-action about planned giving at the very bottom.
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This is a wonderful example of a heart-felt nonprofit thank-you letter following a modest in-Memoriam gift. The handwritten note is a very nice addition which adds a more personal touch to the acknowledgment. Consider doing the same with your thank-you letters, especially to board members, key donors, and smaller donors who you know have higher gift potential.
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This hand-written thank-you note comes from the Executive Director of Jazz Lives Philadelphia, an arts organization. It serves as an excellent template of how to do a thank-you for a major gift. It’s also a great example of how top leadership can elevate the thank-you process to important major donors.
Make sure to have your team generate a formal gift receipt for tax purposes and send it along with the hand-written note.
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Gifts-in-kind can be tricky—both to accept and to acknowledge. This nonprofit thank-you letter template from the International Skydiving Museum and Hall of Fame in Florida handles the task well.
Typically, with in-kind gifts, appraisal of the gift’s value is the donor’s responsibility.
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If one of your loyal donors has included your organization in their estate, it’s important to acknowledge this future gift right now in the present. The nonprofit thank-you letter template presented above can be used as a guide, but be sure to understand the donor’s preferences in terms of being publicly recognized for their giving.
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Yes, thanking your foundation, corporate, and government donors for their gifts is very important. The above grant thank-you letter example is a useful guide. We especially love the touch of incorporating two pictures of adorable children served by the program to bring home the impact of the award.
Many such awards also require filling out various forms and paperwork to return to the grantor prior to the award. It’s an especially nice touch to cover these documents with a letter similar to this.
And, if you’re struggling with funder discovery and grants management, check out Instrumentl. Instrumentl’s all-in-one grants discovery, management, reporting, and collaboration solution is a game-changer for busy nonprofits and grant writing consultants. Interested? Grab your 14-day free, no-obligation trial.
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Charity: Water nailed it with this email thank you. Their specific peer-to-peer campaign to bring clean drinking water to Rwandans was a success. This is how they thanked their donors who participated. Since more people are giving online and via text, sending an email recognition of their gift makes a lot of sense. So does substituting a still photo with a short video.
Older constituents may still prefer a physical letter thank-you, but for Millennials and Gen-Z, emailed thank-you’s can work very well.
No matter what kind of donor thank-you note or message you choose, remember what we’ve learned in this post.
We hope you’ve found this article about the importance of thanking all your donors useful and informative. Here’s to an attitude of gratitude and additional donor retention in 2023!
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