Donor Privacy and First Amendment Rights Assailed: Citizens United’s Uphill New York Battle and Pending H.R.5053
Donor privacy and related First Amendment rights are at stake as state charities’ regulators press for disclosure of IRS Form 990 Schedule B donor information from organizations that fundraise in their states. A recent New York case shows that the fight over whether states may require donor disclosure is very much alive. In addition, Congress is considering elimination of Schedule B itself.
Background - Schedule B, the IRS, and State Charity Regulators
Charitable organizations must comply with both federal and state reporting requirements. The key federal filing is IRS Form 990. Schedule B of Form 990 requires a list of names, addresses, and amounts given for major donors. This mandatory reporting has long been a mainstay within the IRS context, as a measure for nonprofit accountability and particularly to guard against improper donor control. While Form 990s are subject to public disclosure, the IRS is legally obligated to keep Schedule B donor information confidential, under the penalty of civil and criminal sanctions for improper disclosure. Nonprofits thus may legally redact Schedule B donor information on their publicly available Form 990s.