On July 16, 2018, the U.S. Treasury Department released Revenue Procedure 2018-38, which no longer requires certain tax-exempt organizations formed under Section 501(c) of the Internal Revenue Code to report donor names and addresses on their annual Form 990 information returns. This change will take effect for tax years ending on or after December 31, 2018.

Pursuant to the Revenue Procedure, Form 990s or Form 990-EZs filed by most Section 501(c) organizations, including Section 501(c)(4) social welfare organizations and Section 501(c)(6) trade associations, covering fiscal years that end December 31, 2018 or later will no longer need to report donor names or addresses on Schedule B, even on the confidential filing made to the IRS. This policy change applies to all Section 501(c) tax-exempt organizations except Section 501(c)(3) organizations; Section 501(c)(3)s must still report contributor names and addresses on their annual information returns. The Revenue Procedure also does not change the Form 990 reporting obligations of Section 527 organizations.

Section 501(c) organizations affected by this Revenue Procedure must continue to collect donor names and addresses and maintain this information in their internal records, and the IRS may request this information as needed for tax administration. It appears as though affected organizations may continue to report the amounts of substantial contributions on Schedule B. The Revenue Procedure also does not alter the requirement that all organizations that are required to file an annual information return (including Section 501(c)(4) and 501(c)(6) organizations) make their returns available for public inspection, excluding donor names and addresses on Schedule B.

In announcing this policy change, the Treasury Department stated that the IRS “makes no systematic use of Schedule B” with respect to Section 501(c) organizations except for 501(c)(3)s, and the new policy is intended to save government resources and reduce the risk of inadvertent disclosure or misuse of personally identifying donor information.

This change will affect not only filings with the IRS, but also filings with state agencies that regulate charitable solicitations. An increasing number of state agencies have requested the full (unredacted) Schedule B that includes donor information; and there has been litigation regarding those requirements in both California and New York. It is yet to be known whether those states will impose separate requirements to disclose the name and address of substantial contributors.

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