NAICU Washington Update

NAICU Joins Nonprofit Community in Opposing IRS Proposed Gift Substantiation Rules

December 18, 2015

In September, the Treasury Department and the Internal Revenue Service published proposed regulations that would permit, but not require, nonprofits to collect taxpayer identification information – including Social Security Numbers – from donors making gifts that exceed $250 annually. Participating nonprofits would file a new informational tax return, in addition to the Form 990, called a “Donee Report.” The IRS was accepting public comments on this proposal through December 16.

NAICU joined many other higher education associations and nonprofits in signing comments drafted by the National Council of Nonprofits, stating our concern with this proposal. NAICU members agree that the gift substantiation proposal is inappropriate, could impose costs and administrative burdens on nonprofits, and confuse and concern current and future donors. The current reporting system works effectively, and a new reporting system could open the door to potential fraud and abuse, creating a disincentive for donors.

It’s currently unclear when final rules will be published by the IRS.

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