05/16/2024

Senate Bill Introduced to Protect Privacy of Charitable Donors

The act would help nonprofit organizations better protect their donors' identities

Legislation was introduced in the Senate this week to increase penalties for unlawfully disclosing personal information about donors who contribute to nonprofit organizations.

The “Protecting Charitable Giving Act,” introduced by Sens. Todd Young (R-IN) and James Lankford (R-OK), would help nonprofit organizations better protect the identities of their donors by reinforcing existing privacy protections and increasing the penalties for disclosure of sensitive taxpayer information.

• Under the new legislation, penalties would increase from no more than $5,000 to between $10,000 and $250,000.

What they're saying: “Anonymous giving has long been a way for Americans to support philanthropic organizations that rely on generous charitable contributions,” Young said. “In recent years, donor privacy has been threatened on too many occasions. This legislation will address the disclosure of donor data to better protect both charitable organizations and their donors.”

• The IRS requires charitable organizations to collect the names and addresses of all major donors.

• However, the public disclosure of sensitive donor information is not required.

• States such as California and New York have attempted to require donor disclosure, but the Supreme Court ruled in 2021 that these efforts infringe upon First Amendment rights.

This article was provided to OSAP by ASAE's Power of Associations and Inroads.