Author Archives: Ellis Carter

Fundraising – When to Seek Permission

Fundraising to carry-out a nonprofit’s charitable purpose is necessary for the survival of the organization.  However, holding a 501(c)(3) tax exemption does not give unlimited permission to fundraise.  Many nonprofits are unaware of charitable solicitation laws within their own state much less other states where they may be asking for and/or receiving contributions. Continue Reading

Changes to Form 1023-EZ

The IRS has revised Form 1023-EZ, Streamlined Application for Recognition of Exemption Under Section 501(c)(3) of the Internal Revenue Code, and its instructions which went into effect January 10, 2018. The $275 1023-EZ user fee remains the same. The changes are designed to reduce filing errors and increase compliance with respect to those eligible to file Form 1023-EZ. Form 1023-EZ filers must now complete the following: Continue Reading

Tax Cuts and Jobs Act – Tax Exempt Organization Provisions

he Tax Cuts and Jobs Act (HR 1 ) is on its way to the White House for President Trump’s expected signature before the weekend. The bill is set to bring about widespread changes to the US tax code for both businesses and individual Americans. However, it also impacts tax-exempt organizations.  Continue Reading

Moving a Nonprofit to Another State

Nonprofits leaders often desire to move their nonprofit organization’s legal domicile from one state to another. Leadership may decide to move and wish to take the organization with them. In cases where the work is dispersed around the country, the organization may become frustrated with burdensome regulation in the state where it is domiciled and decide shop for a more favorable legal home.
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Proposed Changes to Form 1023-EZ

On September 28, 2017, the IRS Tax Exempt and Government Entities division released its FY 2018 work plan. Of interest to nonprofits and their advisors, the IRS is planning to make changes to Form 1023-EZ early in 2018. These changes are in response to the concerns of stakeholders regarding whether the 1023-EZ process requires too little information. Continue Reading

Nonprofit Law Jargon Buster – What is a “Registered Agent”?

Nonprofits corporations are required to have a registered agent in their state of domicile and in each state where they are registered to do business. The purpose of a registered agent is to ensure that there is a place with a street address (as opposed to a P.O. Box) where an organization can be contacted or served with notice of a lawsuit or other legal action. Continue Reading

Sharing Employees

When affiliated nonprofits work closely together, it is often cost effective to have some shared staff. When structuring shared staffing arrangements, it is important to carefully consider and document how costs will be allocated between the organization. Common arrangements include employee leasing and employee loan arrangements.
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Winos Rejoice! Arizona’s New Liquor Laws for Charities

Charitable organizations in Arizona may serve and auction alcohol at fundraising events provided that they obtain the necessary special event licenses. Additionally, civic organizations, religious organizations, and fraternal organizations in existence for more than five years with regular membership are eligible to apply for special event licenses. Continue Reading

Creating Joint Ventures with For-Profits

To reduce the risk to the tax-exempt organization, the tax-exempt partner should exercise sufficient power and control over the joint venture’s activities to ensure the joint venture operates in furtherance of its tax-exempt purposes. Tax-exempt organizations must be particularly careful when entering into joint ventures structured as partnerships or LLCs because the IRS attributes the activities of such entities to its owners. Continue Reading

Conflicts of Interest – Why They Matter

As most nonprofit directors and executives already know, if decision makers do not disclose their conflicts of interest and properly manage them, there is no way to know whose interest they are serving when they make decisions. Directors and trustees of nonprofits have a fiduciary duty of loyalty to make decisions in the organization’s best interest without regard to their own interests or the interests of third parties. Even the most well-meaning individuals can find their decisions clouded by competing interests. Continue Reading