Many business owners donate to their favorite charity through their business. The IRS requires that businesses report any payments of $600 or more made for services. However, donations do not qualify as payments for services unless you reap a benefit from your donation. Therefore, generally, donations made to nonprofits do not require reporting on a 1099.

Pure Donations

Donations made to nonprofits are not deductible as a business expense. For example, your business donates $1,000 of used computer equipment or cash to the local Boys & Girls Club. This is strictly a donation. C corporations, however, can deduct charitable donations on Form 1120, the corporation tax return. Other businesses operating as partnerships and sole proprietorships or S corporation shareholders and LLC members may deduct donations made by their business on Schedule A of their personal tax return, Form 1040.

Other Nonprofits

Nonprofits classified as trade or business associations do not qualify for charitable contributions and thus, all payments made to them are considered business expenses. Only pure donations to those nonprofits that are exempt from federal and state taxes qualify as donations.

Business-Driven Donations

Charitable contributions made in exchange for some benefit serve a business purpose and therefore are considered a deductible business expense. For example, you place several ads in your child's school newspaper for a total of $650. Since your intention was to drive business, this $650 expenditure is not considered a donation but an advertising expense. If you spend $2,000 on jerseys for your child's soccer team and your business name is on the jersey, that $2,000 is also an advertising expense and not a donation.

Corporate Exemption

Payments made to nonprofits for advertising and marketing services qualify as payments for services. Therefore, these require reporting on Form 1099 if they meet or surpass the $600 threshold. However, corporations are exempt from the 1099 reporting requirements. Many nonprofits are corporations. If the nonprofit you paid for sponsorship or provided goods to is a corporation, you do not need to file a 1099. Corporate nonprofits operate for the public good and those that surpass the minimum annual contribution amount have strong reporting requirements.

Form 1099-MISC

Your company must file Form 1099-MISC with the IRS for any non-corporate nonprofits to which your company paid $600 or more in exchange for services during the tax year. You must also send this form to the nonprofit. Request that any nonprofit you paid or provided goods to in exchange for a service complete a W-9. The W-9 provides the information -- legal business name, tax identification number and authorized signature -- that your company needs to complete the 1099.