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About Harvey Mechanic
Expertise
US Federal tax issues of nonprofit 501(c)(3) public charities only. Establishing and maintaining legal requirements for such non-profit organizations in the United States, including Internal Revenue service filings and requirements. I will not be working on this free forum to answer questions about Nonprofit's unrelated or for-profit businesses or how to fill out forms. This forum is only for general questions about federal tax law, not as the law applies to your specific situation. To search my previous answers you can do a Google search:
site:allexperts.com/q/nonprofit
[with your other search terms appended].

Experience
I have been practicing law and especially the law of nonprofit organizations since 1990 when I was admitted to the New York Bar.

Education/Credentials
B.S. Columbia University in New York City, 1970

J.D. (Law Degree) Brooklyn Law School, 1990 -- Cum Laude

You are here: Experts > Real Estate > Tax Planning: U.S. > Nonprofit Law > gift giving to members of church

Nonprofit Law - gift giving to members of church

Expert: Harvey Mechanic - 11/8/2009

Question
Can a church purchase gifts to presnt to members at Christmas with a value of $35.00 to $40.00 each?dcj5n

Answer
I am assuming that the church gives receipts to donors that they may deduct donations. Then the answer is no, unless the gifts are religious items such as religious books. Otherwise, tax deductible donations could be used for members (donors). Internal Revenue Code section 501(c)(3) at:
http://snipurl.com/7s89j
has, in part, that the 501(c)(3) organization must be
"operated exclusively for religious, charitable, scientific,
testing for public safety, literary, or educational purposes".

Revenue Ruling 56-304 promulgates that "Adequate records and
case histories should be maintained to show the name and address
of each recipient, the amount distributed to each, and the
purpose for which the aid was given, the manner in which the
recipient was selected and the relationship, if any, between the
recipient and members, officers, or trustees of the organization,
in order that any or all distributions made to individuals can be
substantiated upon request by the IRS."
www.irs.gov/pub/irs-tege/rr56_304.pdf
(cited with approval in IRS instructions for Form 1023
Application
for Exemption on pdf page 23 middle column) at:
www.irs.gov/pub/irs-pdf/i1023.pdf)

Harvey Mechanic, Attorney at Law -
Harvey108@hotmail.com

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