Audits and More Audits

Organization Do-Good, Inc. is a (hypothetical) California Nonprofit Public Benefit Corporation with tax exemptions in good standing from the Internal Revenue Service and the California Franchise Tax Board. The Do-Good staff and board know they’re in good standing with the IRS because they were just audited by the federal tax agency. So, that’s it …, right? They’re safe, aren’t they - at least for a while - from any Read More

Property Tax Exemptions: The New Battlefield

In “Local Governments Eager to Snag Revenue from Nonprofits,” we discussed an important trend that should be grabbing the attention of the nation’s 501(c)(3)s: local governments’ myriad attempts to vacuum up loose dollars - or even nickels and dimes - from nonprofits in their communities. Favorite methods include: imposing (or asking for voluntary) “payments in lieu of taxes” (PILOTs), and renaming “taxes” as “fees” Read More

New Law Clarifies Investment Standards for California Charities

In 2015, the California Legislature had a busy and productive year. In addition to high-profile, landmark legislation affecting the population as a whole, lawmakers passed several bills directly affecting nonprofits. One that we haven’t yet discussed is AB 792, signed by Governor Brown on July 6, 2015, and effective January 1, 2016. It was sponsored by the Nonprofit Organizations Committee of the Business Law Section Read More

A Deadlock on a Charity Board: What Then?

The dilemma has been splashed across the headlines for many weeks now: What happens if the current 8-member United States Supreme Court is evenly split on a particular case? There’s a good reason that the Court at full capacity comprises 9 justices - an odd number. Similarly, it’s a good idea to build into any and all deliberative bodies an odd number of members in order to avoid any vote ties.    Optimal Board Read More

Group Exemptions: A Primer

We’ve heard a lot recently about national 501(c)(3)s with affiliates around the U.S. Some are merging with compatible, multi-chapter organizations; others are coming apart at the seams. With fundamental reorganizations come lots of tricky legal issues: ownership of the corporate name, control of assets, and personnel shakeups - to name only a few. There’s also the matter of tax-exempt status. Many of these Read More

Los Angeles Leads the Way Implementing New OMB Grant Rules

A year ago, in March 2015, we reported on a landmark development in federal grants administration. In “New Year, New Accounting Rule: But Don’t Sleep Through This One,” we warned that it was all about “overhead” and “reasonable indirect costs” and “cost allocation rules”: ordinarily a snooze-inducing topic. Nevertheless, there was lots of excitement about it:   The Controller of the Office of Management and Budget Read More

Local Governments Eager to Snag Revenue from Nonprofits

The nation’s charitable organizations have long enjoyed broad support from the general public and federal legislators. From time to time - of course - there are headlines about tawdry scandals or reports of fraud and abuse.  There are occasional Congressional inquiries into troubling practices or disturbing trends.  But there’s little danger of any broadside, direct attack on the availability of the coveted federal Read More

CA Nonprofits Urged to Oppose AB 2855

Assembly Rep. Jim Frazier (D-Oakley) recently introduced legislation in the California Assembly that the California Association of Nonprofits urges all nonprofits to immediately and vigorously oppose. “At CalNonprofits we try to stay hopeful, but AB 2855 is a bad bill with no silver lining.” Assembly Bill (AB) 2855 would require each nonprofit to disclose administrative and overhead expenses on its webpage, along Read More

EEOC Wants More Information From Large Nonprofits

Exempt organizations with 100 or more employees may want to comment on a recent proposal by the federal Equal Employment Opportunity Commission (EEOC) to significantly beef up certain reporting requirements imposed on all employers including large nonprofits. Specifically, the EEOC wants to require, beginning in 2017, that all such entities  report employee compensation and hours worked - in addition to the Read More

How Many Officers Should a California Charity Have?

Especially for people who are new to the world of charities and tax exemptions, even the most basic concepts are perplexing. That includes the basic nature of the corporate structure, how it is governed, and the distinct roles (or “hats”) that various individuals perform. Particularly confusing is the perception - especially to outsiders - that one or two people are doing everything. That may well be true, but there Read More