What is a gift agreement, and what should it include?

By the Awarded team · Published October 19, 2026 · Updated October 19, 2026

In short

What is a gift agreement?

A gift agreement is the signed document between a donor and an institution that records the gift: how much, when it will be paid, what it can be used for, and how the institution will manage and report on it. For endowed and restricted funds it is the governing document, often for decades, so it has to be legal, possible to carry out, and clear enough that someone can administer it long after the people who wrote it have moved on.

What a gift agreement is not

A gift agreement is not a proposal and not a tribute to the donor. It covers the gift. The story of the donor’s life and why they give belongs in stewardship materials. Keeping the agreement focused makes it easier to administer and less likely to conflict with how the fund is actually used.

What to include

01Parties. The donor, or donors, and the institution or its foundation.
02The gift. Amount, form (cash, securities, pledge, gift in kind), and payment schedule, including what happens if a pledge isn’t fulfilled.
03Fund type. Endowed or current use, and the minimum to establish an endowment.
04Purpose. What the money supports, in terms broad enough to remain possible.
05Eligibility and selection. For scholarships and awards, the criteria and who selects recipients. Donors should not select recipients.
06Naming. The fund name, and what happens to naming if circumstances change.
07Stewardship and reporting. What the donor will receive and how often.
08Variance power. The institution’s ability to modify the purpose if it becomes unlawful, impossible, or impracticable. See variance power, explained.
09Investment and spending. For endowments, reference to the institution’s investment and spending policies.
10Signatures. The donor and the institution’s authorized signers.

Who signs a gift agreement?

The donor, and whoever your gift acceptance policy authorizes for the institution. That often depends on gift size and unit: a dean for college-level gifts, the chief advancement officer above one threshold, and the president or board above another. Write those rules down so routing doesn’t depend on memory.

Common mistakes

Restrictions that are illegal or create legal risk, such as criteria based on race, ethnicity, sex, or religion, or proxies for them.
Restrictions so narrow nobody qualifies, like stacking a county, a major, and a high GPA cutoff, or naming a program that later closes.
Vague language such as “deserving” or “of good moral character” that no committee can apply consistently.
No variance language, which leaves a court or a long legal process as the only way to fix an outdated restriction.
Lost history. Drafts, approvals, and the final signed copy scattered across inboxes and drives.

These are the three screens GATO runs on every draft: legality, feasibility, and documentation. Read the guide.

This guide is general information, not legal advice. Review your templates and policies with your general counsel.