FPLG COVID-19 RESPONSE TEAM The COVID-19 crisis marks a new and frightening era for our nation and the world. Everything has been turned upside down; we are all facing massive economic and social disruption.  Nonprofit organizations in the United States are a vital part of our communities, and critical participants in the overall economy. In ordinary times, they provide benefits and enrichment to us all as well Read More

Funders Must Step Up – Right Now!

“Funders,” writes nonprofit blogger Vu Le, “this is the rainy day you have been saving up for.”  Recently, we wrote about Mr. Le’s earlier plea for America’s foundations to step up their payouts beyond the “five percent rule” in the federal tax code. In an article last summer, he characterized it as a moral imperative: The ethical argument for foundations to increase their annual payout rate beyond 5% (August 4, Read More

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