The Private Foundation: It's Not the Founder's Money Anymore

High-net-worth folks have lots of choices about what to do with their money - including how to give it away. Many give outright, unrestricted contributions to existing public charities. Some make restricted gifts or create donor funds. Others are steered by professional and financial advisors toward establishing family (private) foundations, or decide on their own to take this route, without fully understanding the Read More

Gender-Neutral Titles for California Nonprofit Corporations

It was a wild ride for California legislators this year. They faced a daunting, packed calendar of important bills on topics ranging from right-to-die to regulation of the state’s medical marijuana program to gender pay equality. It was a race against the clock, trying to squeeze in final votes on all of the pending measures before the scheduled adjournment on September 11, 2015. In the midst of this hectic calendar, Read More

A New Charity Scandal Brewing – But With a Surprise Culprit!

Each year, California taxpayers have a happy decision to make when completing their state income tax returns. Since 2005, the state personal income tax form has included an option to donate $1 to worthy charities in the Golden State. Generous citizens have been doing just that, to the tune of many millions of dollars transferred from filers’ refund checks otherwise due to the tax coffers of the state. Since the Read More

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