Our high school theatre booster group recently received its 501(c)(3) charitable tax-exempt designation from the IRS. One of our fundraisers is the “membership” drive. We allow anyone to be a “member” and participate in our programs, even if they don't pay the dues. But you can only cast a vote if you do pay the dues. An attorney has told us that, “to be safe, we should not give a tax receipt for the entirety of the dues because each dues paying member gets a vote." Do you agree?
Your attorney is correct that some membership contributions may not be fully deductible if the organization provides goods or services of more than insubstantial value in return. But the right to vote is neither a good nor a service from the organization, and I can’t imagine, even if it were, that the right to vote in a high school theater booster group would have any substantial economic value. The value of the contribution should not be reduced simply because the donor has the right to vote. I think the attorney is a little too conservative on this one.