This question puts an interesting twist on the standard quid pro quo rules. Ordinarily, when a donor makes a contribution to a charity and receives goods or services in return, the donor may deduct only the excess of the payment over the fair market value of the goods or services received in return. (See Ready Reference Page:  “Charities Must Set Value on ‘Quid Pro Quo’ Gifts”) Charities that receive a payment of more than $75 are required to notify the donors of the amount that is not deductible.

The same rules apply to sponsorships. (See Ready Reference Page:  “IRS Finalizes Regs Covering Sponsorships”) Since the event costs you about $100 a person to produce, the hypothetical fair market value is probably about $100 as well.  But you have put the event “on sale,” and are selling it as a loss leader for only $50.  Since anyone may attend for that price, you have set the fair market value of this particular event at $50, and I think it is appropriate to advise your donors and sponsors that they may deduct their payment to the extent it exceeds $50 per ticket.  Simple recognition in an event program and from the podium is not deemed to have specific economic value and would not affect anyone’s deduction. The sponsors would not be able to claim the $100 value of their two “free” tickets as a charitable contribution but could claim a charitable contribution deduction of the remaining $900.