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.