Foundation Penalties: Reasonable Cause Exception?

Because private foundations receive financial support from a single source only or just a few sources, they are subject to much more significant restrictions than public charities. There are rules on how they operate and how they manage and distribute charitable dollars. If they fail to follow these rules, the IRS may impose significant penalties. For instance, “self-dealing” transactions with “disqualified persons” Read More

Exciting Submissions for MacArthur Foundation $100-Million Contest

Early last summer, we reported in “The MacArthur $100-Million Grant Contest,” that the prestigious MacArthur Foundation had launched an audacious competition under the slogan: “Big problems require bold solutions.” According to the terms of the “100&Change” competition announced on June 2, 2016, there is to be a $100-million award for a “single proposal that will make measurable progress toward solving a Read More

Private Foundations: New Program-Related Investments Guidance

Recently, the directors and managers of private foundations read some good news in the Federal Register.  On April 25, 2016, The U.S. Treasury Department issued its long-awaited, final regulations on program-related investments, commonly known as “PRIs.” What are program-related investments? They are an important, useful, and socially beneficial exception to the general rules that foundations must follow in managing Read More

Foundations of Public Universities: Too Secretive?

They have been called “‘slush funds’ and ‘shadow corporations’ that too often operate in secrecy, ….”   “Public officials are raising questions about the spending practices of the nonprofit fundraising arms of public universities,” according to the Council of Nonprofits. They control huge amounts of money with little accountability. Recently, in at least two states - North Carolina and Connecticut - this issue has Read More