Does giving donors naming rights to buildings and programs make for good philanthropy? Careful evaluation and planning are warranted for charitable organizations and their donors. Along with protecting the donors’ tax-deductible gifts, other significant areas to address include manner of recognition, timing, reputational considerations, and changed circumstances.
Recent presidential impeachment hearings have raised the Latin phrase quid pro quo to national attention. What does it mean? The literal meaning of quid pro quo is “something for something.” Put differently, a quid pro quo exists when something is given in exchange for something else. In Thanksgiving parlance, quid pro quo may mean a person better bring a dish (or two) to share at the holiday table! For nonprofits, this term applies to charitable contributions and payments for goods and services, with critical distinctions affecting tax deductibility, tax receipting, and potential “private benefit” tax issues. This article provides a helpful primer on these important tax issues with a special holiday spin.
Encouraging news: Two separate courts recently struck down New Jersey and New York laws requiring mandatory disclosures of donors to nonprofit organizations, affirming First Amendment rights over purported government interests in donor information. These decisions build on both the Trump Administration’s efforts to curtail Section 501(c)(4) donor disclosure requirements and Americans for Prosperity’s ongoing challenge to California’s donor disclosure law applicable to Section 501(c)(3) public charities.