Exempt Organizations: What’s New From the IRS

The Internal Revenue Service has recently announced substantive changes to application forms and procedures for tax-exempt status under sections 501(c)(3) and 501(c)(4) of the Internal Revenue Code. The IRS will reject applications on older - now obsolete - forms.    Form 1023 The changes to Form 1023 are fairly minor. They include revisions consistent with new IRS procedures on public-charity status and on Read More

More About Nonprofits and Labor Laws

In A Reminder to Nonprofit Employers, we discussed common fallacies that many nonprofit directors and staff believe; these mistaken ideas can and do cause their organizations (and them!) a boatload of trouble. First, many people associated with 501(c)(3)s focus only on federal tax-exemption laws and compliance with those complex rules and regulations. They are either unaware of - or ignore - other federal and Read More

Donor Seeks Return of $22.9 Million

The Nonprofit Quarterly’s Ruth McCambridge aptly sums up the most recent, high-profile, “donor wants money back” story: This is an ironic story about a $100 million charitable donation to fund … an institute for conflict-resolution research that is aimed at promoting peace…. Two years later, the parties themselves are in conflict. Twin brothers Thomas L. and Timothy R. Pearson made a gift in 2015 of $100-million to Read More

New Guidance for Nonprofits Making Corporate Changes

Many nonprofit organizations thrive year after year in the same location with the same mission, structure, activities, and operations. For others, though, large or small changes may be necessary or desirable; they and their advisors need to know if - and how - they must report these new developments to the Internal Revenue Service. For many decades, the Treasury Department and the IRS had issued confusing - and Read More

Gifts in Kind: What Nonprofits Should Know

Charitable donations come in different forms; while cash is king, other types of contributions are useful, too.  Among them are “gifts in kind,” sometimes also called “in-kind gifts” or “in-kind donations.”    Different Types of Charitable Gifts A cash contribution is, for many reasons, the preferred type of gift. It’s simple and straightforward and provides the organization with the means to buy any goods or Read More

Religious Nonprofits in the Trinity Lutheran Era

On June 26, 2017, the United States Supreme Court issued what has been described as "one of the most important rulings on religious rights in decades." In Trinity Lutheran Church of Columbia v. Comer, Chief Justice John Roberts explains that the Free Exercise Clause of the First Amendment "...protects religious observers against unequal treatment.” The government “may not deny a church an otherwise available public Read More

Patient Assistance Charity Sanctioned

Last May, in Patient Advocacy Nonprofits’ Dark Ties to Industry, we highlighted the unfolding concerns by regulators about the unsavory ties between charities that advocate for disease sufferers and the pharmaceutical industry. Many of these 501(c)(3) organizations take substantial money from for-profit health care interests, and the industry has seats on the boards of these groups. These conflicts of interest Read More

Are Charities Teetering on the Financial Brink?

“The sky is falling!” - Chicken Little                                                                        Thursday (1/31/18): According to a new report, the “nonprofit sector as a whole is fragile and profoundly undercapitalized.”  Chicken Little is spotted running for cover. Friday (2/1/18): “The Nonprofit Financial Sky is Not Falling.”   Report on Financial Condition of Nonprofits  In late January 2018, Read More

Government Contracts with Nonprofits: Update

Back in March 2015, we alerted nonprofits with government contracts about a development that should interest them. It was a story with snooze-inducing buzzwords: “overhead,” “reasonable indirect costs,” and “cost allocation rules.”  In New Year, New Accounting Rule: But Don’t Sleep Through This One, we explained that the Office of Management and Budget (OMB) had issued new rules called OMB Uniform Guidance for much Read More

Accounting Controls for Nonprofits’ Cash

“According to a recent study by the Association of Certified Fraud Examiners,” we wrote in Charity Fraud: Embezzlement, But Much More, “the typical nonprofit organization loses an estimated 5 percent of its annual revenue to fraud.” There is a false notion in the philanthropic world that theft is rare or, at least, less prevalent than in the for-profit sector. But “...charitable organizations - for a variety of Read More