Patient-Advocacy Charities' Dark Ties: Updates

Recently, in Patient Advocacy Nonprofits’ Dark Ties to Industry, we highlighted the murky, questionable relationships of pharmaceutical companies with patient-advocacy groups. “Patient groups are supposed to represent patients,” we wrote. “But many have deep ties to industry.” The national media is now covering two new research projects uncovering “the incestuous connections between patient-advocacy groups and the Read More

What to Do With an Unusual Grant

Imagine a scene like this: A small group of people is celebrating the receipt that day of an IRS Determination Letter granting 501(c)(3), tax-exempt, status for their new community organization. They are still at the “sitting around a dinner table” stage because there hasn’t been time or the funds to set up office space. On the agenda for that evening is crafting a fundraising strategy to attract financial support Read More

501(c)(3)s Behaving Badly

There are hundreds of thousands of  501(c)(3)s in the United States. Most do great work and are operated cleanly and ethically. Others … not so much.    Case Study No. 1:  Tom and his Best Buddies New England Patriots Quarterback Tom Brady is rich: His estimated net worth is about $180 million or so. His wife, supermodel Giselle Bundchen, is worth almost double: about $360 million. “Like many successful celebrities, Read More

Another Feeder Organization Denied Tax Exemption

In “All Profits to Charity?: Not a 501(c)(3),” we noted that from time to time, folks come into our office with the idea of doing something like Newman’s Own; that is, starting a business and donating all the proceeds to charity. They ask us to help them set up a 501(c)(3) organization. They are generally surprised to learn that Newman’s Own is set up as a for-profit business, and that giving all proceeds to charity Read More

Bipartisan Philanthropy Bill Unveiled

During the 2016 election-campaign season, a key GOP talking point was a promise of  “tax reform.” Now in control of both ends of Pennsylvania Avenue, Congressional Republicans and the White House are eager to move forward. The philanthropy community is alert to any signs or signals about proposals that may affect the nation’s charities, beyond the matter of the Johnson Amendment. In particular, there is concern Read More

Newest Twists on the Johnson Amendment

The “Johnson Amendment” has been confusing and controversial since it was tossed into 501(c)(3) of the Internal Revenue Code in 1954. That year, Congress decided it was time to completely overhaul the existing federal tax code. At the 11th hour, without discussion or debate, then-Senate Majority Leader added the last few words to an already succinct 132-word definition of which organizations can qualify for the most Read More

Dodgy Scholarship Scheme Doesn’t Get Tax Exemption

Responding in 2014 to a nightmarish backlog of tax-exemption applications, the Internal Revenue Service came up with a solution: Offer a short and simple alternative form - the Form 1023-EZ - for many small- to mid-size 501(c)(3) start-ups. The streamlined procedure would have the necessary effect of speeding up the response time from an average 2-year wait down to a few weeks. The trade-off was the miniscule number Read More

501(c)(3) Politics Executive Order: What Effect?

For over a year, there’s been serious chatter in certain quarters about easing the 100% ban - the Johnson Amendment - on political campaign activities by 501(c)(3) organizations including churches and religious groups. It was part of the GOP campaign rhetoric and has continued on in the new Administration. There’s disagreement, though, on the details. Should the ban be eliminated completely? Should the Johnson Read More

Can a Form 990 Be Amended?

Until some major tax legislative changes in 2006, the Form 990 - the information return for exempt organizations - applied to far fewer organizations than now. Generally, mandatory filing was required only for groups that “brought in a lot of donations or held significant assets.” Under post-2006 rules, though, most exempt organizations must file one of the forms in the 990 series - that is, 990, 990-EZ, 990-PF, or Read More

Fewer Regulations: Maybe Not So Good for Nonprofits

With the new Administration, there are lots of big issues being tossed around for discussion and action; health care, immigration, taxes - just to name a few. While these topics make the headlines almost every day, there are other items flying so low under the radar that they may soon crash into the ground. Nevertheless, the latter may result in almost as much chaos and confusion as the big news stories. In this Read More