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Donations to school parent association deductible as charity?

A private, non-profit religious day school has a parent association. Donations to the school are tax-deductible.

The parent association keeps its own bank account. Assets, cash and non-cash, transfer back and forth between the parent association and the school on a regular basis.

Parent association essentially "reports" to the head of school There are regular meetings between the leadership of the parent association and the head of school, and it is exceedingly unlikely that the parent association would ever do anything that the school administration actively disapproved of.

Parent association is not, as far as I know, incorporated as any sort of entity. Its bank account is under the name " parent association."

In my mind, the parent association is an organ of the school, and donations made to the parent association are therefore deductible because donations to the school are deductible.

Agree or disagree? Why?

Reply to
Jonathan Kamens
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I agree mostly. Don't they need to be registered as a charitable entity, and send you a notice to that effect when you donate?

Reply to
JoeTaxpayer

The school is registered with te IRS.

Per Pub. 1771, donations of $250 or more must be acknowledged by the charity, but a canceled check, bank statement, credit-card statement, or other contemporaneous record showing the donation is sufficient to substantiate donations under $250.

Reply to
Jonathan Kamens

When you say "parent association" I will presume you mean an association for the parents of students in the school, not an organization that is a parent of the nonprofit.

The issue is whether the parent association is a branch of the school. To be, the school would have to supervise (or at least have the opportunity to supervise) all actions and finances of the association, and be responsible for the association's actions. As a part of that supervision it would have to assure that the association only used its funds for purposes that coincided with the school's exempt function.

A different but similar approach that would allow donations to the association to be deductible is if the school functions as the fiscal agent for the association. Usually when one nonprofit functions as the fiscal agent for another, any contributions are made officially to the nonprofit, but earmarked for the other organization (I don't know off the top of my head whether that is mandatory). One of the duties of the fiscal agent it to make sure that all funds raised are used only for things that are consistent with the exempt purpose of the nonprofit.

The bottom line is that any contributions need to be explicitly for purposes of supporting the school's exempt purpose, and the school has to be responsible for being sure that actually happens. If either of those are absent, contributions are not, in my opinion, deductible.

___ Stu

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Reply to
Stuart A. Bronstein

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