The materials in our Resources section are for informational purposes only, without any representation that they are accurate or complete. These publications do not constitute legal advice and do not create an attorney-client relationship between the reader and any other person, nor are they an offer to create such a relationship. These publications are current as of the date written, but laws change over time and vary from state to state. As a result, the information presented here may not be timely and/or appropriate for any state not specifically addressed in a publication. Consult an attorney if you have questions regarding the content of any publication.

Donations and Fundraising

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Posted on January 2, 2020

Updated January 1, 2021

Remember that tote bag you got when you made a donation to public radio? Did you know that the IRS cares about the value of that bag? According to the IRS, if something of value is given to a donor in exchange for the donation (a “quid pro quo”), then the donor can only take a tax deduction for the amount of the donation less the value of the item given. But the IRS makes an exception to this requirement if the item is considered a “low cost article”. If the donor only receives a low-cost article (like a tote bag) in exchange for a donation, then the donor can deduct the full value of the donation. What is a “low-cost article” depends upon the amount of the donation and the cost of the article itself. The IRS adjusts these amounts each year for inflation.


Article referenced during the podcast episode: The Rules For Giving Small Items In Return for a Contribution.

Posted on September 9, 2019

Our Fundraising series is exploring the legal aspects of conducting various fundraising activities in the state of Georgia. In this session, our speaker will explain the things nonprofits need to consider when hosting sporting activities such as road races and golf tournaments in Georgia. She will cover topics including risk issues, income and sales tax, and licenses that may be needed.

Speaker: Melinda Simon, Associate General Counsel, Emory University

Click here to view the webcast.

Posted on April 17, 2017

Are you considering conducting commercial type activities – maybe a thrift store or a coffee shop, or selling goods or services of some kind? The IRS has developed short podcasts on various subjects to educate its employees and has made these podcasts available to the public. This podcast explains how the IRS evaluates commercial type activities when deciding whether to approve tax exemption or revoke tax exemption. It’s short (15 minutes long) and helpful.

Posted on March 15, 2017

If you raise money from the general public in Georgia, you may need to make a special filing with the Secretary of State’s office. Here’s a quick review of what you’re required to file, and where.

Posted on December 2, 2015

Here’s a basic guide to sending acknowledgements. When are you required to acknowledge a donation? When is it just the polite thing to do? You’ll see sample letters for quid pro quo, cash, and non-monetary donations, as well as volunteer services.

Posted on December 2, 2015

Learn about the IRS and state regulations for nonprofits when using or selling donated vehicles.

Posted on June 18, 2014

Corporate donations are a fantastic way for nonprofits to raise funds, but nonprofits must proceed with caution when receiving a corporate donation with “strings” attached because the income could be taxable. The donation could be a either a corporate sponsorship or advertising income, depending on how the donor is recognized and what the donor receives in return. The distinction is significant because advertising income can be considered Unrelated Business Income and can therefore be taxable. Your organization controls the outcome! Don’t miss this informative webcast for an overview of:

* What is considered a qualified corporate sponsorship under the Internal Revenue Code
* What benefits can nonprofits give sponsors that will not make the income taxable
* What benefits will trigger Unrelated Business Income Tax and should be avoided
* What other options do Corporate donors have?

Presenters: Timothy Phillips and Laurisa Curran, American Cancer Society

Click here for webcast.

Posted on May 14, 2013

The U.S. Tax Court recently ruled that an individual who had donated over $22,000 to his church could not take a tax deduction for the contribution because the church had not sent the donor the proper acknowledgment. According to the IRS, 501(c)(3) organizations must send a contemporaneous written acknowledgment to donors of over $250 stating:

• Name and address of the charity, date of contribution, and amount of contribution; and
• Whether charity provided any goods or services in return for the contribution. If so, charity must provide a good faith estimate of the value of these goods.

Because the church did not include a statement in the acknowledgment that the donor had not received anything in exchange for their donation, the IRS took the position that no portion of the $22,000 was deductible.

The Tax Court also held that the acknowledgment must be “contemporaneous” meaning that it must be received prior to the donor’s filing of the tax return or the due date of the return (including extensions), whichever came first. The church wasn’t able to fix their mistake after the fact by sending a revised acknowledgment because it was received too late.

You can avoid this very uncomfortable situation with your donors by making sure you promptly send an acknowledgment with the required language.

Click here for our guide to sending proper acknowledgments.

Click here for the IRS guide to Substantiation and Disclosure Requirements.

Posted on January 23, 2013

Nonprofits have significant obligations to register before they ask for contributions and to acknowledge donations when received. These rules vary by state and can be traps for the wary.

During this one hour webinar, our speaker helps nonprofits understand:

• Who needs to register to solicit donations?
• In what states do you need to register when you have a website?
• How do you create a simple system to acknowledge donations?
• What paperwork should be kept to verify acknowledgements?

Presenter: Robyn Miller, Pro Bono Partnership of Atlanta

This video requires <a href="" target="_blank" class="external">Adobe Flash</a> to be viewed.
Posted on December 7, 2011

How does your organization deal with the value of benefits, goods or services given to a donor in exchange for a donation? This publication will teach you how to deal with this and other tricky issues involving written acknowledgements and disclosures.