SECTION 4. RELIANCE ON TAX

EXEMPT ORGANIZATION SEARCH (PUB. 78 DATA) AND THE EO BMF EXTRACT FOR TAX- EXEMPT STATUS

.01 General Reliance Rule .

If an organization listed in or covered by Tax Exempt Organization Search (Pub. 78 data) or the EO BMF Extract ceases to qualify as an organization to which contributions are deductible under § 170 and the IRS revokes a determination letter or ruling concluding that the organization is one to which contributions are deductible under § 170, grantors and contributors to that organization may generally rely on the determination letter or ruling information provided in Tax Exempt Organization Search (Pub. 78 data) or the EO BMF Extract that contributions to the organization are deductible under § 170 until the date of a public announcement stating that the organization ceases to qualify as an organization contributions to which are deductible under § 170. The public announcement may be made via the Internal Revenue Bulletin, on the portion of the IRS website (at www.irs.gov ) that relates to exempt organizations, or by such other means designated to put the public on notice of the change in the organization’s status.

.02 General Reliance Rule for Automatic Revocation .

If an organization listed in or covered by Tax Exempt Organization Search (Pub. 78 data) or the EO BMF Extract ceases to qualify as an organization to which contributions are deductible under § 170 as a result of loss of tax-exempt status pursuant to § 6033(j), grants and contributions made to the organization by persons unaware of the change in the status of the organization generally will be considered deductible in accordance with the rules of § 170 if made on or before the date its

name is posted on the Auto-Revocation List.

.03 Extended Reliance Under Certain Circumstances .

Under certain circumstances, such as if a legally enforceable obligation under local law has been made to the organization prior to the date of the public announcement or posting, and the satisfaction of such obligation occurs on or after the date, the period for which a grant or contribution is deductible may be extended upon specific exercise of authority under § 7805(b)(8). See, e.g., Rev. Rul. 78–129, 1978–1 C.B. 67.

.04 Exception to the General Reliance Rule .

The IRS is not precluded from disallowing a deduction for any contribution made after an organization ceases to qualify under § 170(c) and prior to the public announcement or posting of the revocation if the grantor or contributor:

(1) Had knowledge of the revocation of the determination letter or ruling prior to the public announcement or posting;

(2) Was aware that such revocation was imminent; or

(3) Was in part responsible for, or was aware of, the activities or deficiencies on the part of the organization that gave rise to the loss of qualification.

.05 Reliance Rule for Subsequent Listing After Prior Revocation .

Grantors and contributors may rely on the organization’s subsequent listing in Tax Exempt Organization Search (Pub. 78 data) or the EO BMF Extract for contributions or grants made after the date of the subsequent listing even if the organization’s tax-exempt status was previously revoked if the date the organization is posted in Tax Exempt Organization Search (Pub. 78 data) or the EO BMF Extract is after the date of the public announcement of the revocation of the organization’s tax-exempt status.

.06 Reliance Rule for Subsequent Listing After Prior Automatic Revocation .

Similarly, grantors and contributors may rely on the organization’s subsequent listing in Tax Exempt Organization Search (Pub.

Bulletin No. 2018–23 743 June 4, 2018

.02 Exception to General Reliance Rule .

The grantor or contributor is not entitled to rely on the listed public charity classification of an organization in Tax Exempt Organization Search (Pub. 78 data) or the EO BMF Extract or the listed classification of an organization in its determination letter or ruling if the grantor or contributor:

(1) Had knowledge of the revocation of the determination letter or ruling classifying the organization as a public charity prior to the announcement or posting, or

(2) Was in part responsible for, or was aware of, the act or failure to act that gave rise to the revocation of the determination letter or ruling classifying it as a public charity.