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Nonprofit Law/Charitable Donation - Raffle


I contributed over $200,000.00 to a veterans service  non-profit (501(c)3 for charitable purposes relating to veterans and their families --only. The treasurer of the organization informed me that "he" was ordered to transfer the money from the 501(c)3 account to the 501(c)4 account to pay for legal fees incurred by the organization involving trademark litigation.  Is this legal?  If not -- what can I do about it.  Am I entitled to formal documentation explaining where the money when?

Note--the $200,000 came from bike raffle ticket sales to the public who purchased these tickets based on the assurance that the proceeds would be used to help vets. Does it matter whether the money donated came from charitable donations or my personal account?  PLEASE ADVISE. I NEED HELP. Thanks very much

You wrote "I contributed over $200,000" but then, later, you wrote that "the $200,000 came from bike raffle ticket sales to the public".  I don't understand who ran the raffle, as states generally only allow raffles by 501(c)(3) organizations (or prohibit them even for 501(c)(3) organizations).  Please let me know what entity ran the raffle and, if not the 501(c)(3) organization, whether that operating entity had a contract with the 501(c)(3) organization for the raffle and after you give me that information I will reply further.

Harvey Mechanic, Attorney at Law -

P.S. This response is intended to be a general statement of law, should not be relied upon as legal advice and does not create an attorney/client relationship.  

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Harvey Mechanic


I am an attorney and I volunteer time to answer general questions about U.S. Federal income tax issues of nonprofit 501(c)(3) public charities only. Those questions could be about 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 possible 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. If you do not make your question public then I will not be spending much of my donated time on answers that would not benefit the public. If you have other questions, please contact me at I will reply from my email. In any case, do not reveal confidential information to me until after I have contracted with you to provide personal legal services. My responses on this forum are intended to be general statements of law, should not be relied upon as legal advice, and do not create an attorney/client relationship. For me to consider your individual situation and how the law applies, I would need to gather extensive information about the situation. To search my previous answers you can do a Google search by "" without the quotes and then add your search terms before hitting enter.


I have been practicing law and especially the law of nonprofit organizations since 1990 when I was admitted to the New York Bar and I have maintained my status with the Bar since that time.


B.S. Columbia University in New York City, 1970

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

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