[Effective 7/1/2024]

(a)This part is known and may be cited as the “Charitable Solicitations Act.

Terms Used In Tennessee Code 48-101-501 v2

  • Business: includes every trade, occupation, profession, investment activity and other lawful purpose for gain or the preservation of assets whether or not carried on for profits. See Tennessee Code 48-202-101
  • Charitable organization: means a group which is or holds itself out to be a benevolent, educational, voluntary health, philanthropic, humane, patriotic, religious or eleemosynary organization, or for the benefit of law enforcement personnel, firefighters, or other persons who protect the public safety, or any person who solicits or obtains contributions solicited from the public for charitable purposes. See Tennessee Code 48-101-501
  • Charitable purpose: means a purpose that:
    (A) Would make a corporation operated exclusively for that purpose eligible to be exempt from taxation under Section 501(c)(3) of the Internal Revenue Code. See Tennessee Code 48-51-201
  • Charitable sales promotion: means an advertising or sale conducted by a person who represents that the purchase or use of goods or services offered by the person will benefit, in whole or in part, a charitable organization or charitable purpose. See Tennessee Code 48-101-501 v2
  • Charity: An agency, institution, or organization in existence and operating for the benefit of an indefinite number of persons and conducted for educational, religious, scientific, medical, or other beneficent purposes.
  • Code: includes the Tennessee Code and all amendments and revisions to the code and all additions and supplements to the code. See Tennessee Code 1-3-105
  • Contributions: means the promise or grant of any money or property of any kind or value, including the payment or promise to pay in consideration of a sale, performance or show of any kind which is advertised or offered in conjunction with the name of any charity. See Tennessee Code 48-101-501
  • Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
  • Disaster: means any natural, technological, or civil emergency that causes damage of sufficient severity and magnitude to result in a declaration of a state of emergency by a county, the governor, or the president of the United States. See Tennessee Code 48-101-501
  • Division: means the department of state's division of business and charitable organizations. See Tennessee Code 48-101-501 v2
  • Employee: includes an officer but not a director. See Tennessee Code 48-11-201
  • Entity: includes the following, whether foreign or domestic: LLCs. See Tennessee Code 48-202-101
  • Governor: means a natural person or entity serving on the board of governors of a board-managed LLC. See Tennessee Code 48-202-101
  • Individual: includes the estate of an incompetent or deceased individual. See Tennessee Code 48-11-201
  • Member: means a person reflected in the required records of an LLC as the owner of some governance rights of a membership interest of the LLC. See Tennessee Code 48-202-101
  • Membership: means the rights and obligations a member has pursuant to a corporation's charter, bylaws and chapters 51-68 of this title. See Tennessee Code 48-51-201
  • Parent organization: means that part of a charitable organization that coordinates, supervises, or exercises control over policy, fundraising, and expenditures, or assists or advises one (1) or more chapters, branches, or affiliates in this state. See Tennessee Code 48-101-501 v2
  • Partnership: A voluntary contract between two or more persons to pool some or all of their assets into a business, with the agreement that there will be a proportional sharing of profits and losses.
  • Person: means any individual, organization, trust, foundation, group, association, partnership, corporation, society or any combination of them. See Tennessee Code 48-101-501
  • Professional solicitor: means any person who, for a financial or other consideration, solicits contributions for, or on behalf of, a charitable organization, whether such solicitation is performed personally or through such person's agents, servants or employees or through agents, servants or employees specially employed by or for a charitable organization, who are engaged in the solicitation of contributions under the direction of such person, or a person who plans, conducts, manages, carries on or advises a charitable organization in connection with the solicitation of contributions. See Tennessee Code 48-101-501
  • Property: includes both personal and real property. See Tennessee Code 1-3-105
  • Representative: means a governor, manager, employee or other agent of a foreign LLC. See Tennessee Code 48-202-101
  • secretary: means the secretary of state or the secretary of state's authorized representative or designee. See Tennessee Code 48-101-501 v2
  • Secretary of state: means the secretary of state or the secretary of state's authorized representative. See Tennessee Code 48-101-501
  • solicitation: means any oral or written request, however communicated, whether directly or indirectly, for a contribution. See Tennessee Code 48-101-501
  • State: when applied to the different parts of the United States, includes the District of Columbia and the several territories of the United States. See Tennessee Code 1-3-105
  • United States: includes district, authority, bureau, commission, department, and any other agency of the United States. See Tennessee Code 48-11-201
  • written: means any information in the form of a document. See Tennessee Code 48-11-201
(b)

As used in this part, unless the context otherwise requires:

() “Bona fide Indian organization” means an organization that has been in existence for more than twenty (20) years and that carries out programs and provides services to members of a federally recognized Indian tribe;
( ) “Bona fide religious institutions” include:

(A) Ecclesiastical or denominational organizations, churches, or established physical places for worship in this state, at which nonprofit religious services and activities are regularly conducted and carried on;
(B) Bona fide religious groups that do not maintain specific places of worship, that are not subject to federal income tax, and are not required to file an IRS Form 990;
(C) Such separate groups or corporations that form an integral part of those institutions that are exempt from federal income tax as exempt organizations under section 501(c)(3) of the Internal Revenue Code (26 U.S.C. § 501(c)(3)), or of a corresponding section of a subsequently enacted federal revenue act, that are not required to file an IRS Form 990, and that are not primarily supported by funds solicited outside of their own membership or congregation; and
(D) Such institutions soliciting contributions for the construction and maintenance of a house of worship or residence of a clergy member;
( ) “Charitable purpose”:

(A) Means:

(i) A purpose described in section 501(c)(3) of the Internal Revenue Code (26 U.S.C. § 501(c)(3)); or
(ii) A purpose to achieve:

(a) A benevolent, philanthropic, patriotic, educational, humane, scientific, public health, environmental conservation, civic, or other eleemosynary objective; or
(b) An objective that benefits law enforcement personnel, firefighters, veterans, or other persons who protect the public safety; and
(B) Is not limited to only those purposes for which contributions are tax deductible under section 170 of the Internal Revenue Code (26 U.S.C. § 170);
( ) “Charitable sales promotion” means an advertising or sale conducted by a person who represents that the purchase or use of goods or services offered by the person will benefit, in whole or in part, a charitable organization or charitable purpose. The provision of advertising services to a charitable organization, either for compensation or as a donation, does not of itself constitute a charitable sales promotion;
(1) “Charitable organization”:

(A) Means:

(i) A person that is determined by the internal revenue service to be a tax-exempt organization pursuant to section 501(c)(3) of the Internal Revenue Code (26 U.S.C. § 501(c)(3)); or
(ii) A person who is or holds itself out to be a benevolent, educational, voluntary health, philanthropic, humane, patriotic, religious, or eleemosynary organization, or for the benefit of law enforcement personnel, firefighters, veterans, or other persons who protect the public safety, or a person who solicits or obtains contributions solicited from the public for charitable purposes. A chapter, branch, area, office, or similar affiliate or person soliciting contributions within this state for a charitable organization that has its principal place of business outside this state is deemed a charitable organization for the purposes of this part; and
(B) Does not include an authorized individual who solicits, by authority of the organization, solely on behalf of a registered or exempt organization or on behalf of an organization excluded from the definition of charitable organization;
(2) “Commercial co-venturer” means any person who:

(A) Is organized for profit;
(B) Is regularly and primarily engaged in trade or commerce, other than in connection with soliciting for charitable or civic organizations or charitable purposes; and
(C) Conducts an advertised charitable sales promotion for a specified limited period of time;
(3) “Contributions” means the promise or grant of any money or property of any kind or value, including the payment or promise to pay in consideration of a sale, performance or show of any kind which is advertised or offered in conjunction with the name of any charity. “Contribution” does not include bona fide fees, dues or assessments paid by members; provided, that membership is not conferred solely as consideration for making a contribution in response to a solicitation;
(4) “Disaster” means a natural, technological, or civil emergency that causes damage of sufficient severity and magnitude to result in a declaration of a state of emergency by a county, the governor, or the president of the United States. “Disaster” is identifiable by the severity of resulting damage, as follows:

(A) “Catastrophic disaster” means a disaster that will require massive state and federal assistance, including immediate military involvement;
( ) “Division” means the department of state’s division of business and charitable organizations;
(B) “Major disaster” means a disaster that will likely exceed local capabilities and require a broad range of state and federal assistance; and
(C) “Minor disaster” means a disaster that is likely to be within the response capabilities of local government and to result in only a minimal need for state or federal assistance;
(5) “Federated fund raising organization” means a federation of independent charitable organizations which have voluntarily joined together, including, but not limited to, a united fund or community chest, for purposes of raising and distributing money for and among themselves, and where membership does not confer operating authority and control of the individual agencies upon the federated group organization;
( ) “Generally accepted auditing standards” means the auditing standards issued by the American Institute of Certified Public Accountants for the conduct and reporting of financial audits;
( ) “Parent organization” means that part of a charitable organization that coordinates, supervises, or exercises control over policy, fundraising, and expenditures, or assists or advises one (1) or more chapters, branches, or affiliates in this state. A federated fund-raising organization is not a parent organization;
(6) “Knowingly” or “knowing” means actual awareness of the falsity or deception, but actual awareness may be inferred when objective manifestations indicate that a reasonable person would have known or would have reason to know of the falsity or deception;
(7) “Person” means any individual, organization, trust, foundation, group, association, partnership, corporation, society or any combination of them;
(8) “Professional solicitor” means any person who, for a financial or other consideration, solicits contributions for, or on behalf of, a charitable organization, whether such solicitation is performed personally or through such person’s agents, servants or employees or through agents, servants or employees specially employed by or for a charitable organization, who are engaged in the solicitation of contributions under the direction of such person, or a person who plans, conducts, manages, carries on or advises a charitable organization in connection with the solicitation of contributions. Any independent marketing agent or entity to whom a professional solicitor assigns fund raising or solicitation responsibilities shall be deemed to be a professional solicitor for purposes of this part. A salaried officer or permanent employee of a charitable organization is not deemed to be a professional solicitor. However, any salaried officer or employee of a charitable organization that engages in the solicitation of contributions for compensation in any manner for more than one (1) charitable organization is deemed a professional solicitor. A professional solicitor does not include an attorney, investment counselor, or banker who in the conduct of such person’s profession advises a client;
(9) “Secretary of state” or “secretary” means the secretary of state or the secretary of state’s authorized representative or designee;
(10) “Solicit” or “solicitation” means any oral or written request, however communicated, whether directly or indirectly, for a contribution; and
(11) “Solicitee” or “donor” means any person from whom a charitable contribution or donation is solicited, directly or indirectly, by whatever means by any professional solicitor, a charitable organization or other person, whether any contribution is received in response to the solicitation.
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