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the convenience of its members at their
usual place of employment; or
4. That sells merchandise
substantially all of which was received by
the organization as gifts or contributions;
or
5. That consists of qualified public
entertainment activities regularly
conducted by a section 501(c)(3), (4), or
(5) organization as one of its substantial
exempt purposes (see section 513(d)(2)
for the meaning of qualified public
entertainment activities); or
6. That consists of qualified
convention or trade show activities
regularly conducted by a section 501(c)
(3), (4), (5), or (6) organization as one of
its substantial exempt purposes (see
section 513(d)(3) for the meaning of
qualified convention and trade show
activities); or
7. That furnishes one or more
services described in section 501(e)(1)
(A) by a hospital to one or more hospitals
subject to conditions in section 513(e); or
8. That consists of qualified pole
rentals, as defined in section 501(c)(12)
(D), by a mutual or cooperative telephone
or electric company; or
9. That includes activities relating to
the distribution of low-cost articles, each
costing $12.50 (IRC 1 per Rev. Proc.
2022-38, section 3.34(1)) or less, by an
organization described in section 501
and contributions to which are deductible
under section 170(c)(2) or (3) if the
distribution is incidental to the solicitation
of charitable contributions; or
10.
That includes the exchange or
rental of donor or membership lists
between organizations described in
section 501 and contributions to which
are deductible under section 170(c)(2) or
(3); or
11.
That consists of bingo games as
defined in section 513(f). Generally, a
bingo game isn't included in any
unrelated trade or business if:
a. Wagers are placed, winners are
determined, and prizes are
distributed in the presence of all
persons wagering in that game; and
b. The game doesn’t compete with
bingo games conducted by for-profit
businesses in the same jurisdiction;
and
c. The game doesn’t violate state or
local law; or
12.
That consists of conducting any
game of chance by a nonprofit
organization in the state of North Dakota
and the conducting of the game doesn’t
violate any state or local law; or
13.
That consists of soliciting and
receiving qualified sponsorship payments
that are solicited or received after
December 31, 1997. Generally, qualified
sponsorship payment means any
payment to a tax-exempt organization by
a person engaged in a trade or business
in which there is no arrangement or
expectation of any substantial return
benefit by that person other than the use
or acknowledgment of that person's
name, logo, or product lines in
connection with the activities of the
tax-exempt organization. See section
513(i).
Appendix B. Charitable
Contribution Deduction
Charitable contributions. Filers should
use the following information regarding
the charitable contribution deduction to
complete Form 990-T, Part I, line 4.
Corporations. The total amount claimed
normally can’t be more than 10% of UBTI
figured without regard to the following.
•
Any deduction for contributions.
•
Any capital loss carryback to the tax
year under section 1212(a)(1).
Corporations on the accrual basis can
elect to deduct contributions paid by the
15th day of the 4th month after the end of
the tax year if the contributions are
authorized by the board of directors
during the tax year. Attach a declaration
statement to the return stating that the
resolution authorizing the contributions
was adopted by the board of directors
during the tax year. The declaration
statement must also include the date the
resolution was adopted. See Regulations
section 1.170A-11.
Charitable contributions over the 10%
limitation can’t be deducted for the tax
year, but may be carried over to the next
5 tax years.
In figuring the charitable contributions
deduction, if the corporation has an NOL
carryover to the tax year, the 10% limit is
applied using the taxable income after
taking into account any deduction for the
NOL.
To figure the amount of any remaining
NOL carryover to later years, taxable
income must be modified. See section
172(b). To the extent charitable
contributions are used to reduce taxable
income for this purpose and increase an
NOL carryover, a contributions carryover
isn't allowed. See section 170(d)(2)(B).
Trusts. In general.
1. For contributions to organizations
described in section 170(b)(1)(A), the
amount claimed may not be more than
50% of the UBTI figured without this
deduction; and
2.
For contributions to other
organizations, the amount claimed may
not be more than the smaller of:
a. 30% of UBTI figured without this
deduction; or
b. The amount by which 50% of the
UBTI is more than the contributions
allowed in (1) above.
An increased limitation may be
available for cash contributions under
section 170(b)(1)(G).
Contributions not allowable in
whole or in part because of the
limitations may not be deducted
as a business expense but may be
carried over to the next 5 tax years.
Substantiation requirements.
Generally, no deduction is allowed for any
contribution of $250 or more, unless the
organization gets a written
acknowledgment from the donee
organization that shows the amount of
cash contributed, describes any property
contributed, and either gives a
description and a good faith estimate of
the value of any goods or services
provided in return for the contribution or
states that no goods or services were
provided in return for the contribution.
The acknowledgment must be obtained
by the due date (including extensions) of
the organization's return, or, if earlier, the
date the return is filed. However, see
section 170(f)(8) and the related
regulations for exceptions to this rule.
Don't attach the acknowledgment to the
return but keep it with the organization's
records.
Note. For contributions of cash, check,
or other monetary gifts (regardless of the
amount), the organization must maintain
a bank record, or a receipt, letter, or other
written communication from the donee
organization indicating the name of the
organization, the date of the contribution,
and the amount of the contribution.
Contributions of property other than
cash. If an organization contributes
property other than cash and claims over
a $500 deduction for the property, it must
attach a statement to the return
describing the kind of property
contributed and the method used to
determine its FMV. All organizations must
generally complete and attach Form
8283, Noncash Charitable Contributions,
to their returns for contributions of
property (other than money) if the total
claimed deduction for all property
contributed was more than $5,000.
Special rules apply to the contribution of
certain property. See the instructions for
Form 8283. A donee organization must
use Form 8282, Donee Information
Return, to report information to the IRS
and donors about dispositions of certain
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