Income generated from activities outside a nonprofits’ exempt purpose is taxable as unrelated business income (“UBI”). One option to conduct taxable activity is to form a new company wholly owned by the nonprofit called a taxable subsidiary.
The IRS has issued Notice 2021-56 outlining the requirements that LLCs seeking 501(c)(3) status must meet to be recognized as tax-exempt by the IRS. These
In recent years, there has been some confusing activity around the rules governing campaign intervention for 501(c)(3)s. Nonprofits operating under I.R.C. 501(c)(3) are obligated to
Nonprofit sponsorships are common but the correct way to provide acknowledgments for nonprofit event sponsorship is not well understood. Fundraising galas, breakfasts, golf tournaments, and
By now most family offices and private foundations have heard the story about Archegos Capital. In effect, Archegos operated similarly to a traditional hedge fund—making
Nonprofits that fail to file Form 990 for 3 years in a row will receive an automatic loss of tax-exempt status. The deadline is May 15th.
Sometimes it is necessary for a nonprofit to form a for-profit subsidiary. Knowing how to do this can help avoid losing your tax-exemption.
Normally, corporations can only deduct charitable contributions up to an amount that equals 10 percent or less of their taxable income in the given tax year. Under the CARES Act, this limitation was bumped to 25 percent of taxable income.
More recently, the December 2020 Taxpayer Certainty and Disaster Tax Relief Act (TCDTRA) temporarily upped the limit for corporate charitable contribution deductions to 100% for qualified disaster relief contributions.
The IRS has released additional guidance for corporations considering using the deduction. Here’s what you need to know.
The new tax laws continue 2020 CARES Act changes that increase the above-the-line individual tax deduction to $300. In addition, the new rules double the deduction for married couples filing jointly to $600; the 2020 CARES Act did not have a provision that permitted couples to claim an additional amount over individual filers. Donations must be made in cash (rather than stocks or other assets like cars and clothing; credit cards and checks are OK) and go directly to a charity (donor-advised funds and private non-operating foundations do not count).
At the beginning of each fiscal year, the IRS releases guidance on its compliance priorities for tax-exempt and government entities (TE/GE) and explains how those priorities align with the agency’s strategic goals. This year, the IRS has streamlined its usual annual long letter approach into a short two-page letter and promised to provide quarterly updates on its compliance priorities; an effort to more accurately reflect the fluid nature of IRS operations and shifting compliance priorities throughout the year.
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.