Tax Info Overview: ALWAYS Consult With A Tax Professional. This is NOT Advise, But A Place To Start!

Did you know that as a church, 501c3 is not required. In addition, under the First Amendment: "Congress shall make NO law respecting an establishment of religion, or prohibiting the free exercise thereof." 

"Whether or not a church or church ministry applies for and receives a “501c3 tax-exempt recognition letter” from the IRS, any contributions made to a church are “automatically qualified” as a tax write-off to the contributor, pursuant to IRS Publication 526, and IRS Code § 170(c)(2)(B). A church does not have to be a "nonprofit charitable organization" to be tax deductible, nor does it need IRS authorization to be tax deductible. According to the IRS, churches have that status “automatically.”

Furthermore, from the IRS's site

The following types of organizations are not required to file Form 1023 for recognition of exemption under Internal Revenue Code section 501(c)(3):

  • Churches, including synagogues, temples and mosques.

  • Integrated auxiliaries of churches and conventions or associations of churches.

  • Any organization (other than a private foundation) that has gross receipts in each taxable year of normally not more than $5,000.


Contributors' contributions to these types of organizations are tax deductible. Although there is no requirement to do so, many churches and small organizations seek IRS recognition because recognition assures contributors that contributions are deductible. 

Additional information

You may also want to read "what is a church under law."

This information is for Charity Auctions

Donors who purchase items at a charity auction may claim a charitable contribution deduction for the excess of the purchase price paid for an item over its fair market value.  The donor must be able to show, however, that he or she knew that the value of the item was less than the amount paid.  For example, a charity may publish a catalog, given to each person who attends an auction, providing a good faith estimate of items that will be available for bidding.  Assuming the donor has no reason to doubt the accuracy of the published estimate, if he or she pays more than the published value, the difference between the amount paid and the published value may constitute a charitable contribution deduction.

Record-Keeping and Tax Filing:

IRS rules also require that bidders receive a written acknowledgement from the charity for contributions valued at more than $250. In all cases, the winning bidder should keep a copy of documents -- a check, bank statement or credit card statement, for example -- that show how much was paid to what organization and when. Finally, the charitable contribution is deductible only if the winning bidder itemizes deductions on IRS Form 1040, Schedule A.


About "raffles, bingo, lotteries, and the like:"


Even if you have no interest in the prizes and just want to support a nonprofit cause, you're not allowed to deduct the cost of raffle tickets. According to Internal Revenue Service Publication 526, raffle, bingo or lottery costs can't be written off as charitable deductions, regardless of whether you win any prizes in the drawing or not. You also can't ask for the deduction if you give the tickets away.


Charitable Contributions you can't write off:


The gift that's not a gift:

Tax preparers frequently find themselves presenting bad news to clients seeking charitable deductions for bingo games, raffle tickets or lottery-based drawings used by organizations to raise money. "A lot of people think fund-raising tickets are deductible; they are not," Parquette says...

Undocumented charitable donations:

At the end of the year, when you remember those dollar bills you gave here and there to local charities and churches, you may be surprised to learn that you can't take a deduction because you have no receipts. The IRS requires proof of all cash donations big or small: A canceled check, statement or receipt from the receiving organization suffices...

Quid Pro Quo:

When the donor makes a charitable donation more than $75 and the nonprofit offers a good or service in exchange for said donation, the tax-exempt charity must provide a written statement to the donor disclosing the following:

  • Statement of the good(s) or service(s) received in exchange for donation

  • A fair market value (FMV) of the good(s) or service(s) received.

  • Information for the donor that only a portion of the total contribution (the portion that exceeds the FMV) is eligible for a federal income tax charitable contribution deduction.

As a nonprofit organization offering a quid pro quo donation situation, there’s a penalty for not making the required disclosure of contributions great than $75. The penalty is $10 per contribution up to $5,000 per fundraising mailer or event. If your nonprofit fails to disclose, but can prove the failure was due to a reasonable cause, the penalty may be avoided... 

As a donor, if you’re making a contribution to an organization and receive something in exchange, know that it’s almost like you’re paying for the good/service you receive, but then can deduct the rest of the contribution...