Charitable Solicitation in Tennessee

Charities that intend to solicit donations in Tennessee should not overlook the Solicitation of Charitable Funds Act.

The Tennessee Solicitation of Charitable Funds Act, T.C.A. § 48-101-501, et seq. (“Act”), generally requires charitable organizations that intend to solicit contributions from or within Tennessee to register with the Tennessee Secretary of State prior to any solicitation.  For this purpose, “solicit” means any oral or written request for a contribution, however communicated, whether directly or indirectly.  Under the Act, a “charitable organization” is defined as a group which is or holds itself out as a

  • Benevolent,
  • Educational,
  • Voluntary health,
  • Philanthropic,
  • Humane,
  • Patriotic,
  • Religious,
  • Eleemosynary, or
  • An organization for the benefit of public safety officers.

The term also applies to any person who solicits contributions from the public for charitable purposes (e.g., a professional solicitor)[1].

An organization that is subject to the Act must register with the state and pay a $50 initial registration fee.  In addition, an organization must file quarterly financial reports with the state during its first year of operation.  Thereafter, organizations must file an annual financial report within six (6) months of fiscal year end.  If gross revenue (excluding grants from government agencies and tax-exempt foundations) exceeds $500,000, the report must be accompanied by an audited financial statement and a copy of the organization’s federal Form 990.  The annual filing fee is $80 – $240, depending on gross revenue.

All documents filed under the Act are public records and subject to inspection by the general public.  In addition, solicitation records must be available for inspection by the state attorney general and appropriate district attorneys general.

The penalty for violating any provision of the Act is $5,000 per occurrence.  Registration forms are available on the Secretary of State’s website: https://sos.tn.gov/charitable/charitable-organizations-forms. Online registration is also available: https://sgssos.tn.gov/Login.aspx.

Notwithstanding the foregoing, the Act does not apply to:

  • Bona fide religious institutions;
  • Educational institutions;
  • Certain regulated cooperative scholarship organizations;
  • Charitable organizations receiving less than $30,000 annually in gross contributions from the public;
  • Volunteer fire departments, rescue squads, or local civil defense organizations;
  • Qualified local fairs;
  • Registered political parties, candidates, and PACs;
  • Regulated hospitals; and
  • American Red Cross.

These organizations are generally not required to register under the Act.  The Act makes an exception for any charitable organization that receives public contributions of less than $30,000.  In that case, the organization is required to file an exemption request if it “intends to or does solicit charitable contributions.”  This form is also available on the Secretary of State’s website.

[1] Special rules apply if the entity employs professional solicitors and fundraising counsel.

Posted by Joel D. Roettger, JD, LLM, EPLS

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