This article has been updated July 30, 2021, to include changes to the NYS procedures for collecting Schedule B. This article has been subsequently updated August 26, 2021, to include changes to New Jersey’s procedures for collecting Schedule B.
On July 1, 2021, the Supreme Court of the United States (SCOTUS) struck down California’s requirement that nonprofits submit unredacted donor information with their annual solicitation registrations. The original challenge, brought by the Americans for Prosperity Foundation and the Thomas More Law Center, held that disclosure of donor information violated the donors’ First Amendment rights of association.
In a 6-3 ruling, the Supreme Court upheld the challenge, overturning the decision by the Court of Appeals for the Ninth Circuit and ruling that California may not require charities to submit Schedule B when registering.
Along with New Jersey and New York, California was one of three states to require unredacted Schedule B from the organization’s annual Form 990 return. In light of the SCOTUS decision, the California Attorney General’s website now officially states, “Effective July 1, 2021, the Registry of Charitable Trusts will no longer require the filing of Schedule B to the IRS Form 990 as part of the registration and annual reporting requirements.”
In the months following the Court’s decision, both New Jersey and New York have suspended their requirement to collect Schedule B.
As of July 30, 2021, the New York Charities Bureau is suspending its collection of Schedule B “while we review any amendments that may be necessary to our policies, procedures and forms in order to comply with the U.S. Supreme Court’s decision in Americans for Prosperity Foundation v. Bonta (594 U.S. __, 2021). Effective immediately, charities’ annual filings will no longer require disclosure information that identifies donors. Any notices that charities have received regarding any deficiency due to missing or incomplete Schedule Bs are no longer operative as to such deficiency, and annual filings will no longer be considered deficient in such regard.” (source).
As of August 26, 2021, the state of New Jersey is no longer enforcing its Schedule B requirement. Per the Division of Consumer Affairs’ website, “In light of the United States Supreme Court’s recent decision in Americans for Prosperity v. Bonta, the Division’s Charities Registration Section has determined that the requirement that charities submit the Internal Revenue Service (IRS) Form 990 Schedule B upfront as part of their initial and yearly registrations can no longer be enforced. The Division will therefore be revising its rules, and in the interim will not be taking enforcement action based on the failure to include Schedule B or an equivalent donor schedule in such registrations. The Division will deem any entities that were previously deemed non-compliant solely because they failed to submit Schedule B or an equivalent donor schedule to be in compliance with registration requirements. All other regulations at N.J.A.C. 13:48-1.1 et seq. remain in effect and the Division continues to require the submission of all other schedules and statements.”
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