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C H A P T E R T W E N T Y - T W O2 2Disclosure Requirements§ 22.1 Disclosure by CharitableOrganizations in General 605§22.2 Quid Pro QuoContribution Rules 609§22.3 Disclosureby NoncharitableOrganizations 613There is a substantial and growing body of federal law that imposes on charitableand certain other tax-exempt organizations the obligation to make variousdisclosures to donors in the context of giving to these organizations. Much ofthis law is rested on the concept of substantiation. This area of the law differentiatesbetween charitable and noncharitable tax-exempt organizations.§ 22.1 DISCLOSURE BY CHARITABLE ORGANIZATIONSIN GENERALUntil 1994, a tax-exempt charitable organization was not required by statute tostate explicitly, in its solicitations for support from members of the general public,whether an amount paid to it was deductible as a charitable contribution, orwhether all or part of the payment constituted consideration for goods or servicesfurnished by the organization to the payor. 1It has long been the view of the IRS, however, that if any payment or portionof a payment to a charitable organization is not deductible as a charitable gift, therecipient charitable organization should so notify the payor. 2 That is, it has generallybeen the IRS’s position that it is the responsibility of charitable organizationsto inform their patrons of the distinction between deductible and nondeductiblepayments. The latter includes true dues, payments for admissions or merchandise,and other material benefits and privileges received in return for the payment. TheIRS expected charities, before solicitation, to determine the nondeductible portionof a payment and to clearly state the separate payments on a ticket or other evidenceof payment furnished to a contributor. 3 Also, the federal individual incometax return (Form 1040, Schedule A) and the accompanying instructions inform1 See § 22.2.2 Rev. Rul. 67-246, 1967-2 C.B. 104.3 See § 3.1. 605