Schedule B Donor Disclosures: Supreme Court Sides with Charities

On July 1, 2021, the Supreme Court ruled in Americans for Prosperity Foundation v. Bonta (AFPF v. Bonta) that the California Attorney General may no longer collect Schedule B donor information from charities registered to solicit in the state. In a 6-3 decision, the Supreme Court held that “California’s blanket demand that all charities disclose Schedule Bs to the Attorney General is facially unconstitutional.” Writing the majority opinion for the Court, Chief Justice Roberts reasoned that California’s disclosure requirement violated donors’ freedom of association under the First Amendment and was not narrowly tailored to the important government interest of investigating charitable misconduct. This case represents a resounding victory to charities, and it will undoubtedly shape donor disclosure laws in other states, particularly within the context of charitable solicitation registration.

Virtual Currency Gifts: Should Nonprofits Accept Bitcoin?

As Bitcoin and other virtual currencies become increasingly popular, Section 501(c)(3) nonprofits may encounter a novel question when a donor offers to contribute Bitcoin. Should the nonprofit accept the Bitcoin as a tax-deductible charitable contribution? The short answer is likely, “yes.” Additionally, the nonprofit’s leaders should consider acceptance of such assets as part of a gift acceptance policy. They should also determine whether to sell the donated Bitcoin promptly (like many other donated assets) or to keep it as an investment.

Promoting the Nonprofit Mission, Not Doling Out Business Favors

When may a nonprofit promote a donor's or board member’s business through its website or other communications? If the nonprofit allows the promotion as a sponsorship, through a fundraising program in which the business is donating money to the nonprofit, the promotion is likely permissible. If the business is paying fair market value for advertising, provided the amount of the organization’s overall advertising is within appropriate limits and subject to possible tax liabilities, the promotion should be fine too. But serious legal problems can arise when and if the business does not pay the nonprofit (or pays less than it should) for marketing benefits. Here’s why, as well as how to guard against such problems.

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