Charitable organizations are required to inform donors that “quid pro quo” contributions over $75 are deductible only to the extent that the gift exceeds the FMV of the goods or services provided by the organization. Quid pro quo contributions are payments made partly as contribution and partly as payment for goods or services. Such contributions don’t include any payment made to an organization organized exclusively for religious purposes, in return for which a taxpayer receives solely an intangible religious benefit that generally isn’t sold in a commercial transaction.

Charities are required to provide a written statement in conjunction with quid pro quo donations. The statement must give the donor a good faith estimate of the value of the goods or services included with the “gift.” Charities who fail to do this are subject to a $10 per contribution penalty (but capped at $5,000 per fundraising event), unless reasonable cause can be shown. These amounts are not subject to inflation adjustment. (IRC Sec 6714)

Prior to the TCJA, if a taxpayer made a payment to a college or university that would be allowable as a charitable deduction except that the taxpayer received either a direct or indirect right to purchase tickets for seating at an athletic event in the school’s athletic stadium, 80% of the payment was treated as a charitable contribution.

The TCJA prohibits any portion of such a payment made in 2018 or later to be treated as a charitable deduction. Thus, the charitable deduction for amounts paid for college athletic seating rights has been effectively repealed.