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from what i have been reading on the irs sites and case law, this is considered anywhere from quid pro quo, to coercion, to cooperative fundraising. from everything ive been reading, by demanding payment in excess of the participation fee and calling it a fundraising fee, it can negate their non profit status. i feel that what i found out on my own was much more helpful.
this particular fundraiser is not a sale activity. its just handing the organization money. according to the irs, when the organization keeps a record of who paid and who didnt, its considered an individual fundraising account, and that along with the cooperative fundraising can disqualify the organization