My organization receives much of its income from an annual sale of gift wrap paper and an annual book fair. Both events are conducted entirely with volunteer labor. How should I report this fundraising income when calculating whether my organization meets a public support test? The public support test under section 509(a)(2) of the Internal Revenue Code includes as public support gross receipts from sales of merchandise that are not an unrelated trade or business, such as sales conducted entirely with volunteer labor like the ones you describe. Organizations that receive gross receipts from such events should add those receipts to Line 3 of Schedule A PDF, Part III, if they complete Part III. Additional information Schedule A instructions PDF
