A charity generally is required to register with their state in order to solicit charitable contributions if state law requires. Currently, there are 39 states and the District of Columbia that have such requirements.
Role of the Nonprofit Board
For a nonprofit organization to succeed, it must have a high functioning Board. While management deals with the day to day operations (planning, organizing and executing the organization’s programs), the Board of Directors provides oversight over the organization’s management, finances, mission, and strategic goals.
Can Non-Profits Earn Business Revenue?
With the market volatility of the last six months, funding sources and non-profits alike may be uneasy given memories of the 2008 recession. Although predicting future macro-economic forces may be impossible, it is always a good idea for 501(c)(3) non-profit corporations to seek to diversify revenue streams to prepare for shifts in funding.
Nonprofits and Political Activities
There are 27 different types of non-profits in the Internal Revenue Service (IRS) code, but the most numerous categories are IRS 501(c)(3) corporations (charitable organizations) and IRS 501(c)(4) corporations (social welfare organizations).
Nonprofit Asset Purchase vs Merger – Which Makes Sense for You?
When considering acquiring another nonprofit, there are two types of acquisitions that are typically considered – an asset purchase and a merger transaction. Several factors, including due diligence, payment of consideration, assumption of liability, assignment of contracts (including endowment agreements), existence of planned gifts, future operating goals and applicable state and federal laws, should be considered in determining the structure of the potential transaction.
The Benefits of Starting a Family Foundation
Have you ever considered starting your own private family foundation? For those who have causes you are passionate about, creating […]
Do Tax-Exempt Organizations Have To Report Changes To The IRS?
Tax-exempt organizations must report changes to their name, address, changes to their articles and bylaws, and major operational changes to the IRS.
Best of the Blog 2018
At the end of each year we like to review our most popular posts to see what our readers are most interested in.
Board Member Contracts
All Boards make recruiting mistakes. They carefully vet and enthusiastically elect a new Board member. They hold an orientation, provide […]
What is an Unincorporated Nonprofit Association?
An “unincorporated association” means a group of people who act together in a joint enterprise and for a common purpose.
2019 IRS Work Plan for Tax-Exempt Organizations
Each year, the IRS Tax Exempt and Government Entities (TE/GE) division releases a letter outlining their work plan for the upcoming year. On October 3, 2018, the TE/GE issued their Fiscal 2019 Program Letter.
Hurricane Relief – Donor Beware!
Familiarize yourself with the organization, its mission, and its effectiveness before giving. Always ask for information in writing – be wary if an organization will not provide information about charitable programs and finances upon request. Any legitimate organization will be happy to send you information. Check guidestar.org to review the organization’s financial data and learn more about its mission and finances. Understand that its common for scammers to set-up websites with confusing similar names to well-known charities to steal personal information from those trying to donate. Scammers are also known to set up fake GoFundMe accounts.
Nonprofits Going Global
Increasingly, US NGOs seek to operate overseas. When a US nonprofit expands its activities across borders, whether by making grants or running programs, the compliance obligations of multiple countries can quickly become overwhelming.
Arizona Corporation Commission – Online Services
In May 2018, the Arizona Corporation Commission released a major update to their website’s online services. Users can create an […]
IRS’ Debuts New and Improved Exempt Organization Search
The IRS has debuted a new and improved exempt organization search page. Previously, the public could use the IRS’ Select Check tool to lookup an organization by name or EIN. However, Select Check only permitted confirmation of an organization’s tax-exempt status and whether the organization was a public charity or private foundation.
Nonprofit Board Oversight
A nonprofit’s board of directors is legally responsible for exercising the care an ordinarily prudent person in a like position would exercise in overseeing the organization’s operations. This includes the organization’s finances and legal compliance.
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.
New Form 1024-A: Exemption Application for 501(c)(4) Organizations
The IRS has issued a new Form 1024-A, Application for Recognition of Exemption under Section 501(c)(4) of the Internal Revenue Code for an organization that chooses to apply for recognition of exempt status under Section 501(c)(4).
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:
Good News for Nonprofits Moving to a New State
The IRS recently issued a favorable ruling for nonprofits looking to move their domicile from one state to another. Common reasons that nonprofits seek to change their state of incorporationinclude a change in physical location, increasing regulatory burdens, or a lack of meaningful connection to the original state of incorporation. In such cases,