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Register for unsolicited gifts?

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Register for unsolicited gifts?

Does an organization need to register under state charitable solicitation registration laws if it receives unsolicited donations, e.g., those from individuals and organizations that were not approached specifically asking for donations? In other words, how is "solicitation" defined?

The definition of solicitation, of course, varies from state to state. The definition under the Pennsylvania statute includes “a direct or indirect request for a contribution,” which is similar to the definition in many other states. Under these statutes, receipt of a gift that has not been directly or indirectly requested by the charity or someone else on its behalf would not trigger the registration requirement.
 
The National Association of State Charity Officials recognized that principle many years ago in its so-called “Charleston Principles” by agreeing that receipt of a contribution from an out-of-state donor over the Internet, where the charity did not actively solicit in the other jurisdiction or seek to drive out-of-state traffic to its website, would not necessarily require registration in the state from which the gift was received.
 
The reality of fundraising, however, usually makes the question moot. Once a person makes a contribution, the charity will undoubtedly send a thank-you letter -- and at some point will ask for more. It often happens as part of an automatic bounce-back thank-you on an Internet gift. If the charity is not excluded or exempt from the registration requirement of the other state, the charity is technically required to register before it makes the additional ask.
Tuesday, March 15, 2011

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