Yukon, OK asked in Education Law, Tax Law, Banking and Business Law for Oklahoma

Q: I am on a school board for a private school.

Can a parent make a donation to the school (501c3) and then ask for the money back if they move or enroll their child elsewhere?

1 Lawyer Answer
Charles Watts
Charles Watts
Answered
  • Tax Law Lawyer
  • OKLAHOMA CITY, OK
  • Licensed in Oklahoma

A: The parent can ask - but there isn't anything requiring the refund. There is no federal law, and most states classify the donation as a gift and therefore no longer the property of the person giving the donation, and thus not required to be returned. However, if the funds were donated with an agreement of a specific purpose, for example if the funds were given for the purchase of 10 iPads, but the iPads were never purchased, then it would be considered more of a conditional gift (kind of like a contract) that had never been met, and would most likely have to be given back. If is was just a gift for the general use and purpose of the non-profit, then no obligation to return it. However, take into consideration of why they want it back and the value. If it was less than $100 is it worth arguing about? But also, if you do give it back to them, then you need to report that on a 1099 to them since they most likely took the tax deduction on their personal taxes.

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