This policy was last updated on October 11, 2016
The Indiana University Alumni Association (IUAA) collects sponsorship revenue to raise additional funding for events, activities, scholarships, and general operations. As a non-profit organization, there are guidelines we must follow so that our sponsorship revenue is not subject to income tax. We also want to honor the existing agreements that we have with our current affinity partners that bring substantial support to our organization.
Sponsorships may support IUAA’s activities including those of chapters, constituent societies, and affiliate groups. These groups may not accept advertising revenue or provide advertising because it is considered a “substantial” benefit and makes that revenue taxable to the IUAA. Sponsorships are defined as any payment made by a person engaged in a trade or business for which the person will receive no substantial benefit other than the use or acknowledgment of the business name, logo, or product lines in connection with the organization’s activities. “Use or acknowledgment” does not include advertising the sponsor’s products or services. Please see the Definitions section below for more details on acceptable sponsorship benefits. Groups should have a written agreement with all sponsors. Written agreements are required for sponsorships of $1,000 or greater.
Sponsorships of $2,500 or greater must be approved by Alumni Business Office leadership before soliciting the sponsorship. In addition, sponsorships of $25,000 or greater must be approved by the IU Foundation prior to soliciting. The IUAA Senior Executive Director will serve as a liaison to coordinate with the IU Foundation on any applicable requirements. If a sponsor wants the payment to be considered a tax-deductible contribution, the funds must run through the IU Alumni Association Fund at the IU Foundation (IUF). IUF will send a receipt to sponsor/donor.
Sponsorship agreements must be signed by an IUAA staff member or sponsorship sales representative who is authorized to accept sponsorships on behalf of the IUAA. Any sponsorship agreement or contract greater than $25,000 is not valid without a signature from one of the IU Alumni Association’s authorized signers. If you are not sure who is an authorized signer, please contact your IUAA liaison.
The IUAA, including its chapters, constituent societies, and affiliate groups does not accept sponsorships from the following entities/individuals. If you have questions, contact your IUAA liaison.
- Any political candidate, party or organization
- Any organization that conflicts with an existing sponsorship or affinity partner agreement
- A comprehensive list and agreement research can be provided from your IUAA liaison
- Any individual or organization that clearly conflicts with IU or the IUAA’s values
- Any individuals and groups whose statements, actions, goals, or ideals promote or condone discrimination against individuals or groups on the basis of race, national origin, religion, gender or gender identity, sexual orientation, or persons protected by the Americans with Disabilities Act
Sponsorship Revenue: Any payment made by a person engaged in a trade or business for which the person will receive no substantial benefit other than the use or acknowledgment of the business name, logo, or product lines in connection with the organization’s activities. “Use or acknowledgment” does not include advertising the sponsor’s products or services. Acceptable benefits that may be provided for a sponsorship are:
- Include the sponsor in a list on your group’s website, and include a link to the sponsor’s website so long as the sponsor’s product/service is not endorsed in any way.
- Include the sponsor in event signage and promotional materials associated with the sponsored program or event.
- Include the sponsor in electronic communications about the sponsored event, or include the sponsor in a “thank you” communication for all event sponsors.
- Provide a specific number of event tickets to the event sponsor. This will decrease the tax deductible portion of this sponsorship by the fair market value amount of the tickets if it was considered a tax-deductible contribution.
- Distribute or display the sponsor’s product to the public at a sponsored event, whether for free or for a fee. This is considered “use or acknowledgment” of the product rather than advertising.
You may NOT:
- Promise the sponsor recognition on the IUAA’s web site, in the IUAA’s electronic communications, or in the Indiana Alumni Magazine unless approved by the ABO and marketing leadership.
- Make the sponsor more prominent than the IUAA organization hosting the event.
- Provide the sponsor with a link to their web site if the sponsor conflicts with an existing association sponsor/agreement.
- Provide the sponsor with any access to alumni data. This includes mailing addresses, telephone numbers, and email addresses.
- Provide the sponsor with an advertisement on your group’s web site. Advertising is subject to UBIT (Unrelated Business Income Tax).
- Provide the sponsor with any substantial advertising benefits (as defined below).
Sponsor: Any organization or person who may (or may not) be engaged in a trade or business that provides payment to support an IUAA activity or group as defined by sponsorship revenue.
Advertising Revenue: A payment is NOT a qualified sponsorship payment if, in return, the organization advertises the sponsor’s products or services. Advertising includes:
- Messages containing qualitative or comparative language, price information, or other indications of savings or value
- Inducements to purchase, sell, or use the products or services
IRS.GOV Definitions: https://www.irs.gov/publications/p598/ch03.html#en_US_2014_publink100011928