Do Ice Bucket Challenge Donations Lack the “Donative Intent” Necessary to be Tax-Deductible?

Mary Ellen Wimberly, KLJ Staff Editor[1]

In the summer of 2014, the ALS Ice Bucket Challenge took social media by storm. The premise was simple: those nominated to complete the challenge had to either pour a bucket of ice cold water on themselves or give $100 to the ALS Association.[2] Many chose to make donations in addition to participating in an icy shower. The challenge raised awareness for amyotrophic lateral sclerosis (ALS), often called Lou Gehrig’s Disease, and also resulted in donations of $115 million to the ALS Association.[3]

Many taxpayers will deduct these charitable contributions on their federal income tax returns without thinking about whether these contributions qualify for a deduction. While Section 170 of the Internal Revenue Code generally allows deductions for charitable contributions[4], courts have interpreted the provision to also require “donative intent.” This requirement may limit the deductibility of those ALS Ice Bucket Challenge donations that were contributed because the participant wanted to avoid a cold shower.

The test for donative intent in charitable contribution cases comes from the landmark case Commissioner v. Duberstein, which established the intent required by a transferor in making a “gift” for income tax purposes.[5] The U.S. Tax Court has consistently applied the Duberstein test in determining the donative intent requirement for charitable contribution cases,[6] and has noted that in determining whether a charitable contribution qualifies under § 170, “the term ‘charitable contribution’ is synonymous with the word ‘gift.’ ”[7] Therefore, to satisfy donative intent, the taxpayer’s charitable contribution must be made with detached and disinterested generosity and without the expectation of receiving something in return.[8] The Tax Court further delineated the test in DeJong v. Commissioner and stated that “[i]f a payment proceeds primarily from the incentive of anticipated benefit to the payor beyond the satisfaction which flows from the performance of a generous act, it is not a [charitable contribution].”[9]

However, courts have generally interpreted the “donative intent” test liberally and in recent years have added a “quid pro quo” requirement, which provides that donative intent is lacking only when the donor anticipates receiving an actual financial benefit from the charitable contribution.[10] Consequently, because those who chose to forego the cold shower and opted to make a donation instead gained no financial benefit, those taxpayers should be able to correctly claim a deduction for a charitable contribution under Section 170.


[1] J.D. expected May 2016.

[2] Meg Tirrell, Ice Bucket Challenge: 6 Months Later, CNBC (Feb. 9, 2015, 8:26 AM), http://www.cnbc.com/id/102405889.

[3] The ALS Ice Bucket Challenge, ALS Association, http://www.alsa.org/fight-als/ice-bucket-challenge.html (last visited Mar. 29, 2015).

[4] 26 U.S.C. § 170 (2012).

[5] Commissioner v. Duberstein, 363 U.S. 278, 285 (1960).

[6] See Rodney P. Mock, Burning Down the House and the Charitable Deduction, 11 Hous. Bus. & Tax L.J. 353, 360 n.41 (2011).

[7] DeJong v. Commissioner, 36 T.C. 896, 899 (T.C. 1961).

[8] Duberstein, 363 at 285.

[9] DeJong, 36 T.C. at 899.

[10] See generally Tony Nitti, Could the IRS Disallow Ice Bucket Challenge Charitable Contributions?, Forbes (Aug. 20, 2014, 9:24AM),  http://www.forbes.com/sites/anthonynitti/2014/08/20/could-the-irs-disallow-ice-bucket-challenge-charitable-contributions/.