501(c)(3) Organization: Public Charity or Private Foundation

Organizations described in Internal Revenue Code Section* 501(c)(3) fall into two categories:  private foundations and public charities.  Under Section 509, all organizations, domestic or foreign, described in Section 501(c)(3) are private foundations except the types of organizations described in Sections 509(a)(1), (2), (3) or (4).  "Public charities" is the generic term given to the excepted […]

Donor-Advised Fund Regulations Step One: Request for Comments

On December 4, 2017, the Internal Revenue Service and U.S. Treasury Department released Notice 2017-73 (Request for Comments on Application of Excise Taxes With Respect to Donor Advised Funds in Certain Situations), seeking comments to help them develop donor-advised fund regulations in three specific areas. Written comments must be submitted by March 5, 2018 and may […]

Nonprofit Corporation Legal Audit

All too often, whether a nonprofit corporation is legally compliant in its operations receives attention only after a conflict or issue arises. Instead, a nonprofit corporation can better prevent such conflicts and protect itself through regular legal audits of its corporate governance, federal and state tax exemption, other federal tax law matters, employment and volunteer […]

Starting a Related Nonprofit: 7 Initial Considerations

If your for-profit company is interested in starting a related nonprofit, here are 7 initial considerations to take into account before moving forward: 1. Are you properly intentioned? A nonprofit exempt under 501(c)(3) of the Internal Revenue Code must have a charitable, educational, or other 501(c)(3)-consistent purpose and must not be operated for the benefit of […]

‘Tis the Season to Be Compliant: Tips for Organizations on IRS Requirements for Deducting Charitable Contributions

The holiday season is a time of giving. Along with the presents exchanged at gatherings with friends and families, many gifts are made to nonprofits in the closing month of the year at holiday charity galas and auctions, through end-of-the year email and direct mail appeals, and through other fundraising events. For charities, the deductibility […]

Emerging Leaders Program: Center for Volunteer and Nonprofit Leadership

The Emerging Leaders Program (ELP) of the Center for Volunteer and Nonprofit Leadership "addresses the core competencies needed to effectively manage organizations and complex programs as well as the leadership skills one needs to be successful within our quickly changing sector."  Last week, Emily Chan and I spoke to the ELP group on various legal […]

Can a Nonprofit Own a For-Profit? Can a For-Profit Own a Nonprofit?

The quick and admittedly general answers (because there are exceptions) are: (1) yes, a nonprofit can own a for-profit; and (2) no, a for-profit cannot own a nonprofit, but it can select all of the nonprofit’s board members and thereby largely control the nonprofit. Can a Nonprofit Own a For-Profit? A nonprofit can own all […]

Comparing 501(c)(3) vs. 501(c)(6) for Nonprofit Startups

A nonprofit organization organized and operated for charitable purposes may be exempt under Section 501(c)(3) of the Internal Revenue Code while a nonprofit organized and operated to promote the common business interest of its members and not to engage in regular business activities ordinarily carried on for profit may be exempt under Section 501(c)(6) of the Code. While […]

Nonprofit Directors and Officers – Not the Same Thing

Many nonprofits fail to respect the differences between directors and officers. When an individual holds both the position of director (i.e., board member) and an officer position (e.g., chair of the board), we often see such individual elected for only the officer position. It is then assumed that such person automatically also becomes a director, […]

2019 Skoll World Forum – Day Two

I’m in Oxford, England for the 2019 Skoll World Forum on Social Entrepreneurship, taking place from April 9 through April 12. This year’s theme, Accelerating Possibility, is focused on exploring how humanity can accelerate a future that is fair, inclusive, and sustainable. You can find links to my recaps of Day One, Day Three, and Day Four […]