E-business, or e-commerce, activities are any activities by which payments are received through use of the internet or other electronic means. Examples of e-business activities at the University include the sale of tickets to athletic events, acceptance of application fees and tuition, acceptance of donations to the University, registration or fees for conferences, and sale of publications.
A Merchant Services Agreement is an agreement with a third party financial services entity that will accept credit card information submitted over the internet, charge the appropriate credit card company, and send the money to a University account. All Merchant Services Agreements must be reviewed, approved and signed by the Office of Finance.
As a non-profit organization whose website is on a .edu domain, advertising on the University’s website presents several difficulties. First, advertising revenue is considered to be unrelated business income, subject to taxation by the IRS. The University attempts to limit this type of income wherever possible. Second, advertising activities are generally inconsistent with a .edu domain, and inconsistent with the University’s noncommercial status and presentation of itself on the internet. While advertising is problematic, the University can, under IRS regulations, solicit certain sponsorships in support of its mission and non-profit activities without incurring taxation on this income and without creating the other problems described above. The difference between advertising and sponsorship is the subject of some very specific IRS regulations that focus on the difference between acknowledgment of support (which is sponsorship) and the offering or endorsement of a product or service for sale (which is advertising). Questions regarding sponsorships can be directed to the Office of Institutional Advancement or the University of Pittsburgh and UPMC MHSF.
The University has already established a website to allow donors to contribute to the University by credit card via the internet. Due to the need to track donations accurately and provide appropriate receipts for tax deduction purposes, all donations should be directed through the Ways to Give website. You may wish to link the site for your school with this donation site.
Yes, because e-commerce activities involve the electronic transmission of financially sensitive information, including possibly credit card numbers or University account numbers, you must exercise care to ensure that this information is not made available to unauthorized persons. Please refer to the University of Pittsburgh Payment Card Industry Technology Guidelines for more information.