Funds Raised by Hospital Auxiliary Groups

Question: Our auxiliary groups raise money for the hospital. Can we count these funds as a community benefit?

Recommendation: We recommend reporting the cost of raising the funds as a hospital community benefit, if these costs are borne by the entity that houses the hospital (EIN) and will be used to support community benefit activities. This means that the hospital and auxiliary are housed in the same entity, having a single EIN and the funds are used for activities that meet the criteria for community benefit.  You can also report the cost of community benefit programs provided by the hospital with funds raised by the auxiliary.. Funds raised by the auxiliary for non community benefit programs, such as purchase of a new MRI machine, are not reportable as community benefit. 

(Updated November 2015)

Please Take Note: The information provided does not constitute legal or tax advice. The material is provided for informational/educational purposes only. Please consult with counsel regarding your organization's particular circumstances.