Summary: This guide explains Tithely's "Cover the Fees" feature, which allows donors to offset transaction fees, ensuring the church receives the full intended donation. It breaks down the calculation process and details how to manage the feature's default settings.
What is "Cover the Fees"?
"Cover the Fees" is an option that allows donors to increase their total donation by a small percentage to cover the transaction fees (processing fees) associated with their online gift.
- Result for Church: The church receives the full intended donation amount (100% of the net gift).
- Result for Donor: The donor's total charged amount is tax-deductible, and they are credited the higher, adjusted amount.
4 Benefits of “Cover the Fees” for the Church
- Maximized Donations: Ensures the church receives the full intended gift amount.
- Transparency in Giving: Donors know exactly where their money is going.
- Enhanced Stewardship: Fosters a culture of responsibility for operational costs.
- Budget Predictability: Reduces the unpredictable nature of fluctuating processing fees.
Step-by-Step Instructions
1. Log into Tithely as an Admin or Limited User with Finance Permissions.
2. Select Giving from the left-hand menu.
3. Select Giving Form → Settings.
4. Scroll down to the Payment Information area.
5. Toggle the 'Show Cover the Fees' option on or off. [It is enabled by default.]
6. Adjust the default setting for "Cover the Fees." [Donors can still disable this option at the donation point, even if the default is set to "on."]
7. Click Save Changes at the bottom of the page.
Cover the Fees Calculation Explained
Because the fee is based on the total charged amount, the gift must be increased by a calculated amount slightly larger than the flat transaction fee to ensure the net deposit equals the original intended gift (G).
Formula to Calculate Total Transaction Amount (T):
- G: The original gift amount (e.g., $75.00)
- P: The percentage fee for processing (e.g., 2.9% for VISA/MC; 3.5% for AMEX; 1% for ACH)
- T: The total amount the donor is charged.
Example: $75.00 Gift on VISA (2.9% + $0.30)
| Scenario | Donor Charged | Church Deposit (Net) | Fee Paid | Donor Credited |
| NO Cover the Fees | $75.00 | $72.53 | $2.47 | $75.00 |
| YES Cover the Fees | $77.55 | $75.00 | $2.55 | $77.55 |