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§ 22.3 DISCLOSURE BY NONCHARITABLE ORGANIZATIONSrelatively harmless, as the patron is likely to know the charity’s good faith estimatefigure in advance of the payment and thus cannot help but have thisintent. Still, proving intent is not always easy. This development is unfortunate,inasmuch as the law has been evolving to a more mechanical test (and thus isless reliant on subjective proof): any payment to a charitable organization inexcess of fair market value is regarded as a charitable gift. 44§ 22.3 DISCLOSURE BY NONCHARITABLE ORGANIZATIONSCertain contribution disclosure rules are part of the federal tax law. 45 These rulesare not applicable to charitable organizations.These disclosure rules are applicable to all types of tax-exempt organizations(other than charitable ones), and are targeted principally at social welfareorganizations. 46 They are designed to prevent these noncharitable organizationsfrom engaging in gift-solicitation activities under circumstances in whichdonors will assume, or be led to assume, that the contributions are tax deductible,when in fact they are not. These rules do not, however, apply to an organizationthat has annual gross receipts that are normally no more than $100,000. 47Also, when all of the parties being solicited are tax-exempt organizations, thesolicitation does not have to include the disclosure statement (inasmuch asthese grantors have no need of a charitable deduction). 48This law applies in general to any organization to which contributions arenot deductible as charitable gifts and which• is tax-exempt, 49• is a political organization, 5044 See § 3.2(b). A payment made to a charitable organization in excess of the fair market value of an item is notnecessarily the consequence of donative intent. In the case of an auction, for example, the patron (successfulbidder) may just intensely want the item, or be motivated by peer pressure or extensive access to an open bar;charity may be the farthest thing from the patron’s mind.45 IRC § 6113. The IRS published rules to accompany this law in 1988. IRS Notice 88-120, 1988-2 C.B. 459.46 That is, organizations that are exempt under IRC § 501(a) by reason of being described in IRC § 501(c)(4).See Tax-Exempt Organizations ch. 12.47 IRC § 6113(b)(2)(A). In determining this threshold, the same principles that obtain in ascertaining the annualinformation return (Form 990) $25,000 filing threshold apply. Rev. Proc. 82-23, 1982-1 C.B. 687. (This$25,000 filing threshold is discussed in Tax-Exempt Organizations § 24.3(b)(ii). In general, these rules utilizea three-year average. The organization must include the required disclosure statement on all solicitations mademore than 30 days after reaching $300,000 in gross receipts for the three-year period of the calculation. IRSNotice 88-120, 1988-2 C.B. 459).A local, regional, or state chapter of an organization with gross receipts under $100,000 must include the disclosurestatement in its solicitations if at least 25 percent of the money solicited will go to the national, or other,unit of the organization that has annual gross receipts over $100,000, because the solicitation is considered as beingin part on behalf of that unit. Also, if a trade association or labor union with more than $100,000 in annualgross receipts solicits funds that will pass through to a political action committee with less than $100,000 in annualgross receipts, the solicitation must include the required disclosure statement. (These three types of tax-exemptorganizations are the subject of Tax-Exempt Organizations chs. 13, 15, and 17, respectively.)48 IRS Notice 88-120, 1988-2 C.B. 459.49 That is, is described in IRC § 501(a) and IRC § 501(c) (other than, as noted, charitable organizations describedin IRC § 501(c)(3)).50 That is, is described in IRC § 527. 613