Cause-Related Marketing: The California Rules

Fundraising is the lifeblood of 501(c)(3) charities. Whether an organization has an in-house development department or hires consultants, government regulators take a keen interest in the process and the results of soliciting charitable donations. Outside Solicitation Help In “Taking Fundraising Outside the Organization,” we introduced the California rules that apply when a charity turns to outside help with Read More

The Private Benefit Rule: Three More Examples

“If you’re looking for a way to lose your hard-earned section 501(c)(3) tax exemption,” we explained in an earlier post, here’s how: “Wander away from [your] charitable purposes into the land of too much “private benefit” and - especially - the quicksand of “inurement of your net earnings to private individuals.” The often-confused “Private Benefit Rule” and the “No Inurement Rule” come from a single phrase in the Read More

Surprise Change to Charity Raffle Rules in California

Raffles are among the most popular special events for charity fundraising. Organizations love them; donors love them. It’s a win-win. But a special few nonprofits - those affiliated with major sports teams - are going to love them even more, thanks to an eleventh-hour gift from California legislators. Just ahead of the scheduled, September 11th, adjournment of the 2015 Regular Session of the Legislature, lawmakers Read More

Gender Equality (and Nonprofits): California's Bold New Law

We’ve already cautioned nonprofits to be on the alert for new laws coming on the books, from time to time, around the nation. The special status of 501(c)(3)s “lulls many boards and staff into a false sense of believing the rules that apply to regular corporations and regular workplaces don’t apply to them.” California’s “Avalanche” of New Laws The California Legislature recently ended a marathon legislative session Read More

Special Meetings: What Are The Rules?

We’ve recently covered news stories about two nonprofits in which leadership abruptly - and unexpectedly - asked their boards to close down the organizations.   In each case - Virginia’s Sweet Briar College and the San Diego Opera - the board chair, in cooperation with the CEO - called a special meeting in which the closure vote was suddenly presented and then voted on immediately. Newspaper reports of the San Diego Read More

A Nonprofit Bylaws Checkup: Where to Start

There’s a good reason why you're likely to find an amendment clause in your nonprofit's bylaws: It's meant to be used from time to time. The amendment bylaw wasn’t thrown into the mix as an afterthought, or as filler to pad the document’s page-count to make it look more impressive. It's perfectly ok, often advisable, and sometimes absolutely necessary, to review and update your corporate bylaws. But too many Read More

Launching a Family Foundation: Pros and Cons

Giving generously to favorite charitable causes is a long tradition in American culture. Each year, donors in the United States contribute hundreds of billions of dollars for worthy institutions and projects. Many wealthy individuals, couples, and families make substantial donations directly to established organizations that have received the most favorable – that is, “public charity” – status under the Internal Read More

With Dollars at Stake, a Nonprofit's Name is a Big Deal

  “Proctor: ...How may I live without  my name? I have given you my soul.  Leave me my name!” Arthur Miller, The Crucible, Act II, Scene 3   It’s a dog-eat-dog world in the chase for charitable donations.   A nonprofit that wants to survive in this competitive market needs a corporate name that is widely recognized and associated in the public’s mind with that organization alone. Sometimes, though, there’s Read More

Beyond the Basics of Fundraising: Commercial Fundraisers

Many charities conduct their own fundraising campaigns; some have in-house development directors and staff. As we mentioned in “Taking Fundraising Outside the Organization,” other organizations, though, need help from time to time with solicitation efforts, and turn to “fundraising counsel,” “commercial coventurers”, or “commercial fundraisers.” These terms are defined in the primary statutory scheme for regulation Read More

The Conflict of Interest Policy: Why is it Needed?

“A policy governing conflicts of interest is perhaps the most important policy a nonprofit board can adopt….”   That’s advice from the  National Council of Nonprofits. It mirrors the position of the Internal Revenue Service that this is a big deal. New organizations applying for tax exemption must indicate, on the Form 1023, if they’ve adopted a conflict of interest policy.   Many of these startups use the Read More