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Nonprofit Law/Question about travel team donations.


Starting up a travel basketball team. If donations are accepted, and in return we put their business on our uniforms, shooting shirts and such, can this be deducted from their taxes as advertising? We are not currently 501 (c) (3) status. Do we need a federal tax id number for anything other than a checking account? I have researched for a while and can't find a straight up answer.

Thank you.

I have in my profile that this free forum is only for general questions about IRS federal exemption issues of 501(c)(3) organizations. Your question is about a business deduction for a for-profit business that is giving funds to a travel basketball team.  Even though your question is beyond the scope of this free forum, I will advise you that the business can deduct the value of the advertisement as a business expense.  If they give more than the value, that additional amount is a donation and not deductible, as you have indicated that you have not set up the travel basketball team as a 501(c)(3) organization. Usually I can do that for under $1000, but, if you don't want to do the proper set-up then you would be able to obtain a EIN (Employer Identification Number - or Taxpayer Id number), but it would not be only for checking purposes.  You also have a purpose to engage in a service (advertising). Because your organization is not going to be treated as exempt by the IRS, it would normally be required to declare the income from advertising revenue (and the payor would be sending a copy of the Form 1099-Misc that it sends to the IRS every year that its payments are over $600.

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. For me to consider your individual situation and how the law applies, I would need to gather more information.

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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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