CA Issues Cease-and-Desist Orders to Out-of-State Charities

On March 12, 2018, Javier Becerra, the Attorney General of California, announced cease-and-desist actions against four charities from other states that had fraudulently - according to the government - solicited funds from California residents. The jurisdiction of this state’s top law-enforcement officer extends not only to California charities but also to 501(c)(3)s anywhere in the nation who ask for Read More

Charity Navigator Announces New Service

New Jersey-based Charity Navigator (CN) is “the country’s leading online charity evaluation service.” A 501(c)(3) itself, this organization helps donors make informed decisions about spending their charitable dollars. It gives information and data for about 1.6 million nonprofits including evaluations of these organizations' financial condition, accountability to the public, and transparency in operations.” Charity 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) Groups: Steer Clear of the Legal Minefields

For directors and staff of many 501(c)(3) organizations, a primary concern and ongoing worry is - as it should be - compliance with all rules and regulations necessary to maintain the valuable federal tax exemption. Indeed, in earlier posts, we highlighted - collectively and individually - the key ways that a 501(c)(3) can sink a tank exemption. That was - actually - the title of the lead post in this multi-part Read More

What’s Next After the Tax Exemption Letter?

There’s no shortage of books, articles, blog posts, website columns, and other sources of information about how to form a nonprofit corporation or how to get a tax exemption. What happens, though, at the moment after all the initial work is done? The corporation has been formed; you have the fancy binder. The 1023 or 1023-EZ has been filed (and perhaps has been quickly approved). The initial board meeting has been Read More

What, Exactly, is a “Suggested Donation”?

When charity board members or staff sit around a conference table planning their next fundraising special event, the discussion inevitably turns to how much to charge. When a price is determined, it’s not uncommon, especially in smaller organizations, for someone to recommend that the amount be described in publicity materials or on tickets as a “suggested donation” amount of $X. In another conference room somewhere Read More

Let's Start the New Year with Good News: Progress on the Multistate Charitable Solicitation Registration

Perhaps the most unexpected aspect of the recent, bizarre, presidential campaign was that charity law - yes, charity law! - was thrust into the daily news cycle. Among the meaty issues - alleged or real - that legal analysts, anchors, and pundits tossed about is the often-overlooked requirement in about ¾ of U.S. jurisdictions that 501(c)(3) charities file state charitable solicitation registration documents.   While Read More

Court Blocks Donor List Request – Again

Federal and state regulators want charities to disclose significant amounts of information. For the most part, these organizations are on board with the notion of full transparency. There have, however, been giant battles and resistance from some quarters in connection with requests for disclosure of donor lists on annual information returns. This controversy has played out at the federal level, in connection with Read More

Year-End Donor Queries and the Overhead Myth

In December 2014, we posted “Uh Oh. It’s the End of the Year and We Have Money Left Over!” The point, of course, was that many nonprofits mistakenly believe they have to spend down every last penny by year’s end in order to maintain their status. We clarified that the term “nonprofit … usually means the type of organization that has successfully jumped through the proper state and federal hoops to receive the most Read More

Congress Digs In On Huge College Endowments

“A not-so-old joke has it that Harvard is best thought of as a hedge fund with a university attached.” The fund in question is its endowment - the largest in the United States - valued at over $35 billion. There have been growing concerns in recent years about the massive nest eggs of the nation’s most prestigious institutions of higher learning. These criticisms arise against a background of record-breaking Read More