
Nonprofits and Affiliated Entities
There are many reasons nonprofit organizations find it in their mutual best interest to work together to deliver services.
There are many reasons nonprofit organizations find it in their mutual best interest to work together to deliver services.
The group exemption permits a central or parent organization to certify that each subordinate qualifies for exemption and to include it under its umbrella for tax-exemption purposes. The process is designed to reduce paperwork for both taxpayers and the IRS where affiliated entities are similar in their purpose, structure and operations.
Prior to passage of AREA, an entity seeking to change its structure likely had to undergo a multi-step transaction to accomplish its goal. AREA permits direct conversions and makes clear that it applies to all entity types (corporations, nonprofits, benefit corporations, LLCs, partnerships, etc.).
Too often, we see nonprofits signing contracts that are presented to them by vendors without appropriate legal review. Many vendors use form contracts that are extremely one sided in the vendor’s favor on the theory that many clients will sign whatever is given to them without scrutinizing the terms.
At the end of each year we like to look back at our most popular posts to evaluate what our readers are finding most interesting and useful on the blog. What follows is a list of CharityLawyer’s Top 10 posts for 2014 measured by page views
Going into effect January 1, 2015, the Arizona benefit corporation statute will enable entrepreneurs to form a corporation unlike anything Arizona has seen before. Benefit corporations enable social entrepreneurs to create a corporate structure requiring the corporation to create a general public benefit. As with anything new, its details are untested and some confusion surrounds it. Below we dig into the statute and detail what you will and will not be able to do in 2015.
The nonprofit should not estimate the value of a donor’s non-cash contribution. The nonprofit is under no obligation to appraise the value of a contribution and should not attempt to do so. The burden of valuing the contribution rests solely on the donor.
The Guidance is clear “ charter schools must have nondiscriminatory student discipline policies implemented in a nondiscriminatory manner. The Guidance draws a distinction familiar in the area of employment law: disparate treatment and disparate impact. Under Title IV and VI of the Civil Rights Act as well as under Arizona law, charter schools must create and enforce a nondiscriminatory student discipline policy.
Many founders feel guilty accepting reasonable compensation from the nonprofit they have nurtured but if they continue to forgo a reasonable salary, they risk erecting a house of cards that will fall apart as soon as they burn out.
Today, the Internal Revenue Service released the new Form 1023-EZ application form to reduce processing delays and help small charities apply for 501(c)(3) tax-exempt status more easily.
Most states require you to register your organization if you solicit donations from their residents. Many states also require registration if your organization collects substantial or ongoing donations from their residents, even if you aren’t specifically targeting donors in that state. Download our comprehensive list of each state’s requirements.
Download our free guide to learn about the many elements needed to run a successful nonprofit organization, as well as how to avoid common pitfalls and mistakes.