The nonprofit law podcast highlights legal issues facing nonprofits. Hosted by Tim Mooney, an attorney with over a decade of experience in nonprofit law, this entertaining and informative program helps staff, officers and directors of nonprofits to understand the laws that impact their organizations.
On February 20th, the IRS released T.A.M. 200908050
Arguably a stricter stance at affiliated 501(c)(3)-501(c)(4) entities sharing websites when the 501(c)(4) is engaged in political activity that is prohibited for 501(c)(3)s.
What we’ve always thought
Caveat – the IRS rarely gives a lot of spot-on advice, so “what we’ve always thought” is based on educated conjecture based on existing precedent
501(c)(3)s and affiliated 501(c)(4)s can share the same website so long as corporate formalities were followed.
The (c)(4) can be on the (c)(3)’s website, but there had to be some kind of way for the (c)(4) to reimburse the (c)(3) for using that space.
The (c)(4) also had to be the entity making the communications as well.
The IRS in this T.A.M.
The entities involved here had the (c)(4) reimbursing the (c)(3) for the space, but the (c)(3)’s logo and copyright information were splashed all over the (c)(4) page content.
That was a compelling factor for the IRS… more compelling than which entity paid for the communications that endorsed candidates and included non-(c)(3) allowable candidate questionnaires.
Where does this leave us?
It does not appear that the IRS is closing to door to shared sites, but it is clear that details matter beyond which group cuts the check for which content.
The safest thing would be separate websites altogether – and these days, it’s certainly less of a cost issue to maintain 2 domain names and 2 design schemes than in year’s past.
I suspect, although it’s not 100% clear from the T.A.M., that the (c)(3) and (c)(4) could share a domain hosting package so long as they split the costs, and maintain separate websites with separate communications.
Linking between the two should still be acceptable under earlier law, but it cannot rise to the level of campaign intervention, so the links are best left as, “we have an affiliated organization and you can read more about that work here.”
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law.
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law.
Your guide to the laws impacting nonprofits
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This is a re-presentation of 2007′s end of the year guide to recordkeeping – a timely reminder for all calendar fiscal year organizations!
What should we be doing at the end of a fiscal year? Listener question…
It’s big enough of a task to be mentioned alone: recordkeeping.
It’s the law
It’s a good management tool
It can protect you against false accusations by others that would like to make your organization’s existence more difficult
Corporate record book
Make one if you don’t have it… a binder with all of your important docs
IRS determination letter, articles of Incorporation, bylaws, and minutes of board meetings
This should be permanently kept and updated when necessary
Remember some of these documents must be made publicly available, so this is an important one
Lobbying and other reporting information
Keep track of hours of lobbying as a 501(c)(3)
Keep track of amount of partisan activity as a 501(c)(4)
You’ll need this for your 990 in the spring
Financial records
Bank statements, old Form 990s, internal reports by treasurers, etc.
Keep these for at least seven years (law requires 3 for some, like the 990s)
Make sure you are keeping up with donor receipts for end of the year appeals!
Email me with questions and suggested topics
Screencast on using the Internet, podcasting and social networking for your nonprofit – go to nplawcast.com for details
Need more than a podcast? Tim-Mooney.com nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law.
Tim Mooney… Welcome to the Nonprofit Law Podcast
Your guide to the laws impacting nonprofits.
Shownotes…. nplawcast.com Email the show
What does the IRS have in store for nonprofits in 2009?
“a lengthy examination of how tax-exempt groups raise and spend money compared to how much they spend to achieve charitable goals.”
“Nonprofit student-loan groups also will be under greater scrutiny from the IRS next year, as the agency seeks to guard against abuses by organizations that are connected to for-profit businesses.”
“The IRS also will look at how nonprofit organizations and donors account for non-cash gifts, such as pharmaceuticals or used clothing, that are given to tax-exempt groups, which in-turn donate to a different nonprofit group.”
“The agency also plans to take a look at its own operations next year… consider governance issues that may be used in determining whether an organization qualifies as a charity.”
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law.
Tim Mooney… Welcome to the Nonprofit Law Podcast
Your guide to the laws impacting nonprofits.
Shownotes…. nplawcast.com Email the show
When is a person acting on their own versus acting on behalf of their organization?
- Joining a nonprofit as a director or a staff member doesn’t take away your individual rights
- Individuals can do things that are otherwise forbidden… donate time/money to campaign, etc.
- General rule – so long as an organization’s financial resources, facilities, or staff are not used, the organization is not going to be beholden to the individual acts of its staff, officers or directors
When do the actions become attributed to an organization? - Principles of agency are used… if the person acts as if they have power, and they actually do have the power, the IRS will usually consider the action that of the organization - Actions of individuals that weren’t ok’d by the group, but were later “implicitly ratified.” (i.e. Organization found out about the actions and did not disavow them)
Tips & Best practices
- Have a policy in place on use of organizational resources
- Encourage use of disclaimers for individuals working on non-organizational endeavors (i.e. “organization shown for identification purposes only”)
Resources
Election Year Issues (pp. 363-365) – IRS CPE Text
Election Year Activities for Section 501(c)(3) Organizations: Frequently Asked Questions – McDermott Will & Emery Closing
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law.
Tim Mooney… Welcome to the Nonprofit Law Podcast
Your guide to the laws impacting nonprofits.
Shownotes…. nplawcast.com Email the show
Check out the new website
New adds include a searchable database of all shows. If any links are a mess, drop me a line.
Change comes to DC – What are the plans for nonprofits?
Resources – look for something akin to the bailouts in the for profit sector, although the focus will be in the form of a newly formed Social Investment Fund Network – federal seed money leverages private sector funding
Tax law changes – any tax increases on higher income Americans could (possibly… depending on whom you ask) enhance the incentives to make charitable donations
Scrutiny – Sen. Charles Grassley (R-IA) and Sen. Max Baucus (D-MT) of the Senate Finance Committee have been poking around the nonprofit sector for years. Sen. Grassley in particular has been the most interested in creating additional regulatory hoops for nonprofits to jump through.
Closing Email me with questions and suggested topics
Sign up for the free NLP newsletter… every week get an early look at the shownotes and resources sent to you by email, plus get additional free content on the laws impacting nonprofits. Go to nplawcast.com/newsletter for more info and to sign up.
Need more than the podcast? Tim-Mooney.com and Beyond the Podcast at nplawcast.com nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law
Tim Mooney… Welcome to the Nonprofit Law Podcast
Your guide to the laws impacting nonprofits.
Shownotes…. nplawcast.com Email the show
Check out the new website
We had a meltdown in the website code, so I made lemonade from lemons and moved everything over to a new system that should be more stable. New adds include a searchable database of all shows. If any links are a mess, drop me a line.
Fall and winter means donation time (we hope!)
federal tax law requires charities to provide receipts to donors so that that may take advantage of their generosity
IRS – true to form, does not give us any particular formatting on what charities need to provide, but they’re more than happy to create problems for charities that fail to provide them
The amount of money or a description of the item donated
A statement indicating whether or not any goods or services were provided in return for the gift; receipts from religious organizations must include a statement indicating that “intangible religious benefits” were provided but they have no monetary value for tax purposes
A good-faith estimate of the value of goods or services provided; insubstantial values need not be recorded
Email is totally acceptable – everyone thank the IRS for joining the Internet revolution!
Want to check out what our neighbors north of the border are like on this? Take a look at the Sens Foundation’s admonition not to ask for a receipt unless you really, really need one… I’ve never seen anything like that before!
Closing Email me with questions and suggested topics
Sign up for the free NLP newsletter… every week get an early look at the shownotes and resources sent to you by email, plus get additional free content on the laws impacting nonprofits. Go to nplawcast.com/newsletter for more info and to sign up.
Need more than the podcast? Tim-Mooney.com and Beyond the Podcast at nplawcast.com nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law
Tim Mooney… Welcome to the Nonprofit Law Podcast
Your guide to the laws impacting nonprofits.
Shownotes…. nplawcast.com Email the show
Election season brings out the advocacy issues for nonprofits
- Some churches are about to get in a heap of trouble… Alliance Defense Fund is trying to take on the IRS and the tax prohibition on electioneering. It’s probably going to cost some churches, but more importantly the hubris will impact the church goers
The First Amedment is alive and well, but it doesn’t simultaneously create the right to tax deductibility of donations. That’s a privilege.
- Campaign finance laws were thankfully overturned, and here’s why… In 2000, Congress passed McCain-Feingold, or BCRA – it contained a well-intentioned but overbroad provision that essentially banned any broadcast advertisement that mentioned anyone running for federal office within 60 days of the November elections.
The Supreme Court overturned it because it banned all ads in those windows, including ones that are purely within free speech categories – like lobbying
When I lobbied supporters and authors of this law, I was constantly asked what kind of things could possibly come up within 60 days of an election that nonprofits and other corporations would want to weigh in on?
Well… we all just experienced it – the rescue bill was firmly within the 60 day window and without the wisdom of the Court (a phrase I do not often use) an election law would have stopped organizations from weighing in on the bill via broadcast ads.
Even supporters of BCRA were uncomfortable on this point… Resources
Election Law Blog on the BCRA 60 day windows Action Urged Against Politicking Pastors – The Chronicle of Philanthropy
Closing Email me with questions and suggested topics
Sign up for the free NLP newsletter… every week get an early look at the shownotes and resources sent to you by email, plus get additional free content on the laws impacting nonprofits. Go to nplawcast.com/newsletter for more info and to sign up.
Need more than the podcast? Tim-Mooney.com and Beyond the Podcast at nplawcast.com nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law
Tim Mooney… Welcome to the Nonprofit Law Podcast
Your guide to the laws impacting nonprofits.
Shownotes…. nplawcast.com Email the show
- – This podcast is dedicated to the memory of Sean May. To learn more about Sean, please visit seanmaymemorial.com. – -
One less step in organizing a nonprofit!
Straight from the IRS:
The Internal Revenue Service and the Treasury Department today issued new regulations that will streamline the approval process for organizations seeking tax-exempt status as publicly supported charities.
The new regulations do away with the so-called advance rulings that granted public charity status for an initial five-year period but required exempt organizations to demonstrate, after the initial period, that they in fact received a substantial part of their support from public sources to receive a final determination letter.
Closing Email me with questions and suggested topics
Sign up for the free NLP newsletter… every week get an early look at the shownotes and resources sent to you by email, plus get additional free content on the laws impacting nonprofits. Go to nplawcast.com/newsletter for more info and to sign up.
Need more than the podcast? Tim-Mooney.com and Beyond the Podcast at nplawcast.com nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law
Tim Mooney… Welcome to the Nonprofit Law Podcast Your guide to the laws impacting nonprofits. Shownotes…. nplawcast.com Email the show
Craigslist Foundation Nonprofit Bootcamp Highly recommend this great day of learning about nonprofits, including nonprofit law Alliance for Justice session on lobbying was excellent NYC 2008 Podcasts should be up soon – in the meantime, check out past ones If you’re in the Bay Area, I highly encourage you to attend the west coast version on October 18, 2008 in San Mateo, CA
IRS revamps Pub 1828, the Guide to Churches and Religious Organizations
IRS Publication 1828 (PDF) – Designed for religious organizations, but this guide is an excellent parallel resource for secular charities as well
Inurement and Private Benefit
No special deals for insiders
No charitable dollars to individuals’ “private benefit”
Employment Tax
The basic ins and outs of withholding and other issues
Payment Of Employee Business Expenses
How to properly reimburse
Recordkeeping Requirements
Simple rules for keeping the IRS happy if you’re audited
Substantiation and Disclosure Rules for Donations
What you have to do when you receive tax-deductible donations
A great index to other relevant IRS pubs (special note to my silver medal for best IRS pub: Publication 557)
Update reflects some of the examples and guidance from Rev. Rul. 2007-41
Examples illustrating the application of the facts and circumstances test for campaign intervention
If you’re a non-religious org, check out the Revenue Ruling… Pub 1828 focuses on the religious org examples
Closing Email me with questions and suggested topics Sign up for the free NLP newsletter… every week get an early look at the shownotes and resources sent to you by email, plus get additional free content on the laws impacting nonprofits. Go to nplawcast.com/newsletter for more info and to sign up. Need more than the podcast? Tim-Mooney.com and Beyond the Podcast at nplawcast.com nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law
Tim Mooney… Welcome to the Nonprofit Law Podcast Your guide to the laws impacting nonprofits. Shownotes…. nplawcast.com Email the show I’ll be at the Craigslist Foundation Nonprofit Bootcamp in NYC on August 16th – if you attend and see me, feel free to say hello! Thanks to Texas Nonprofits for featuring the show on their homepage! It sparks my craving for Ironworks BBQ in Austin…
Can a staff member also serve on the board of directors?
From a listener email: keep the suggestions coming!
Some people are absolutists about this – it’s an unworkable conflict of interest. Early in my career I was confronted with an ED who was convinced it was actually illegal.
In some circumstances, this may be true – check your state laws regarding conflicts of interest, but also your bylaws and conflict of interest policies
Assuming none of these things block it, serving on the board as a staff member IS possible
It’s more of an issue for small, but growing nonprofits
Why? It’s a route to compensate a person for their work – paid as a staff member, but still present as an unpaid board member. (wearing two hats)
Pitfall: Conflict of interest – breach of duty of loyalty (for more, go back to NLP #35)
From BoardSource: “It is probably impossible to find a board member who will never have any conflicts of interest… if these associations develop into conflicts of interest and become a major obstacle to fulfilling the duty of loyalty — one of the main legal obligations of board members — it may be necessary to re-evaluate the board member’s suitability for current board service.”
If it makes sense for your organization to have a person serve as a board member, have a very strict policy regarding breach of loyalty. Best practice would be an abstention policy where the board member recuses him or herself from any votes that impact staff. Another (perhaps better) policy would be to have the board member serve in an ex officio capacity (i.e. no voting power on the board, but has full authority to be present and debate all decisions).
Closing Email me with questions and suggested topics Sign up for the free NLP newsletter… every week get an early look at the shownotes and resources sent to you by email, plus get additional free content on the laws impacting nonprofits. Go to nplawcast.com/newsletter for more info and to sign up. Need more than the podcast? Tim-Mooney.com and Beyond the Podcast at nplawcast.com nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law
Tim Mooney… Welcome to the Nonprofit Law Podcast Your guide to the laws impacting nonprofits. Shownotes…. nplawcast.com Email the show I’ll be at the Craigslist Foundation Nonprofit Bootcamp in NYC on August 16th – if you attend and see me, feel free to say hello! Thanks to Texas Nonprofits for featuring the show on their homepage! It sparks my craving for Ironworks BBQ in Austin…
Can a staff member also serve on the board of directors?
From a listener email: keep the suggestions coming!
Some people are absolutists about this – it’s an unworkable conflict of interest. Early in my career I was confronted with an ED who was convinced it was actually illegal.
In some circumstances, this may be true – check your state laws regarding conflicts of interest, but also your bylaws and conflict of interest policies
Assuming none of these things block it, serving on the board as a staff member IS possible
It’s more of an issue for small, but growing nonprofits
Why? It’s a route to compensate a person for their work – paid as a staff member, but still present as an unpaid board member. (wearing two hats)
Pitfall: Conflict of interest – breach of duty of loyalty (for more, go back to NLP #35)
From BoardSource: “It is probably impossible to find a board member who will never have any conflicts of interest… if these associations develop into conflicts of interest and become a major obstacle to fulfilling the duty of loyalty — one of the main legal obligations of board members — it may be necessary to re-evaluate the board member’s suitability for current board service.”
If it makes sense for your organization to have a person serve as a board member, have a very strict policy regarding breach of loyalty. Best practice would be an abstention policy where the board member recuses him or herself from any votes that impact staff. Another (perhaps better) policy would be to have the board member serve in an ex officio capacity (i.e. no voting power on the board, but has full authority to be present and debate all decisions).
Closing Email me with questions and suggested topics Sign up for the free NLP newsletter… every week get an early look at the shownotes and resources sent to you by email, plus get additional free content on the laws impacting nonprofits. Go to nplawcast.com/newsletter for more info and to sign up. Need more than the podcast? Tim-Mooney.com and Beyond the Podcast at nplawcast.com nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law
Closing Email me with questions and suggested topics Sign up for the free NLP newsletter… every week get the shownotes and resources sent to you by email, plus get additional free content on the laws impacting nonprofits. Go to nplawcast.com/newsletter for more info and to sign up. Need more than the podcast? Tim-Mooney.com and Beyond the Podcast at nplawcast.com nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law
Tim Mooney… Welcome to the Nonprofit Law Podcast
Your guide to the laws impacting nonprofits.
Shownotes…. nplawcast.com Email the show
Commensurate in Scope ruling
A recent private letter ruling, the IRS applied a somewhat controversial standard to reject exempt status to an organization that was a faith-based organization that also was creating tax-friendly financial plans for it’s constituency.
Remember, that it is totally feasible for a charity to engage in business activities and engage in business activities, however there are limitations out there (UBIT, etc.)
But also remember that charitable organizations must be”exclusively” formed for charitable activities
The commensurate in scope standard is that you have to have sufficiently large enough charitable programming relative in size to the financial resources of the organization.
The organization in the PLR was only spending 1% (according to the IRS) on charitable activity, so this was an easy one from their perspective
However, where does one draw the line? And how do you handle organizations such as The Nature Conservancy that have literally billions of dollars locked into land? Are they less allowed now to engage in business activities?
This goes hand in hand with my call last episode for an (admittedly semi-overstated) Apollo Project on nonprofit regulation. We need more clarity and less ambiguity coming from the IRS
Closing Email me with questions and suggested topics
Sign up for the free NLP newsletter… every week get the shownotes and resources sent to you by email, plus get additional free content on the laws impacting nonprofits. Go to nplawcast.com/newsletter for more info and to sign up.
Need more than the podcast? Tim-Mooney.com and Beyond the Podcast at nplawcast.com nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law
Tim Mooney… Welcome to the Nonprofit Law Podcast Your guide to the laws impacting nonprofits. Shownotes…. nplawcast.com Email the show
More clarity, not less
From BNA:
‘Inferential’ Intervention Trend
[Marcus Owen's] firm has seen the emergence of differing interpretations of the facts-and-circumstances standard that IRS applies to all political activity referrals, he said. Some offices have a more liberal interpretation where only allegations of explicit statements of campaign intervention lead to investigations, while other offices are more willing to look at allegations of implicit or indirect campaign intervention, he said.
What he called a determination of “inferential” intervention is also emerging from IRS. This he described as “inferences derived from discussions of candidate’s positions on an issue … but somewhere else in the organization, another Web site or something off a Web site could carry with it a flavor of the organization’s position on the same issue, and IRS could conflate those two and come to the conclusion that there was inferential intervention.”
Closing Email me with questions and suggested topics Sign up for the free NLP newsletter… every week get the shownotes and resources sent to you by email, plus get additional free content on the laws impacting nonprofits. Go to nplawcast.com/newsletter for more info and to sign up. Need more than the podcast? Tim-Mooney.com and Beyond the Podcast at nplawcast.com nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law
Tim Mooney… Welcome to the Nonprofit Law Podcast
Your guide to the laws impacting nonprofits.
Shownotes…. nplawcast.com Email the show
How you can pick up clues on the type of nonprofit you hear about in the news
This show is all about figuring out the type of nonprofit
A recent article on David Brock’s new organizational involvement spurred this:
“Brock wouldn’t detail Progressive Media USA’s strategy, and stressed that – as required by his group’s nonprofit status – the spending would be on a mix of direct electoral politics and issue ads with no direct connection to the race.” (Politico/CBSNews.com)
What type of nonprofit?
501(c)(3)? Check out their website… do they allow for charitable deductions for donations? Does the solicitation page specifically say contributions are NOT deductible?
Deductible? 501(c)(3)… likely a public charity
If not… keep looking for more clues!
Does the organization engage in ALL election activity supporting or opposing a candidate?
Probably a 527
Does it do mixed advocacy – some supporting or opposing a candidate and some not?
Probably a 501(c)(4)… Progressive Media USA might event have both a (c)(4) and an affiliated 527, so it’s not always as easy to pick out everything from one source!
Little clues here in there can lead you find out without relying on the cheat (Guidestar or a personal visit to the offices!)
Closing Email me with questions and suggested topics
Sign up for the free NLP newsletter… every week get the shownotes and resources sent to you by email, plus get additional free content on the laws impacting nonprofits. Go to nplawcast.com/newsletter for more info and to sign up.
Need more than the podcast? Tim-Mooney.com and Beyond the Podcast at nplawcast.com nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law
Closing Email me with questions and suggested topics Sign up for the free NLP newsletter… every week get the shownotes and resources sent to you by email, plus get additional free content on the laws impacting nonprofits. Go to nplawcast.com/newsletter for more info and to sign up. Need more than the podcast? Tim-Mooney.com and Beyond the Podcast at nplawcast.com nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law
Tim Mooney… Welcome to the Nonprofit Law Podcast Your guide to the laws impacting nonprofits. Shownotes…. nplawcast.com Email the show
News & Notes - From the Nonprofit Law Blog (tim-mooney.com/lawblog) - Senate deepens financial review of television ministries – NBC is reporting that the Senate Finance committee is renewing its demands for certain churches to provide detailed financial information. The letters sent today are a follow-up to letters sent last year to a virtual who’s who of large televangelist ministries, including Benny Hinn and Kenneth Copeland. - IRS reaches out to charities to aid in economic stimulus – The IRS is encouraging various partners and stakeholders such as charities, churches and governmental organizations to assist in efforts to reach out to those Americans who may be eligible for the 2008 economic stimulus payment but who normally have no requirement to file a tax return. People who receive certain Social Security, Veterans Affairs, Railroad Retirement or wages from earned income or combat pay may be eligible and not know it.
Joining a nonprofit board - Duties of care, loyalty, and obedience - duty of care is the duty to pay attention to the organization—to monitor its activities, see that its mission is being accomplished, and guard its financial resources. - duty of loyalty is the duty to avoid conflicts of interest - In cases of potential conflict of interest, directors must act to preserve and enhance public trust in the organization by putting the interests of the organization ahead of all other business and personal interests. - Watch out for self dealing! - duty of obedience is to carry out the purposes of the organization and to comply with the law. - Before you say yes and join the board, do your homework - Know the bylaws - Know the expectations (financial goals for board members, etc.?) - Know how you protect the organization (insurance coverage sufficient? etc.)
Closing Email me with questions and suggested topics Sign up for the free NLP newsletter… every week get the shownotes and resources sent to you by email, plus get additional free content on the laws impacting nonprofits. Go to nplawcast.com/newsletter for more info and to sign up. Need more than the podcast? Tim-Mooney.com and Beyond the Podcast at nplawcast.com nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law
Tim Mooney… Welcome to the Nonprofit Law Podcast Your guide to the laws impacting nonprofits. Shownotes…. nplawcast.com Email the show
News & Notes - Nonprofits and Elections: Balancing Personal Versus Organizational Activity on-demand video screencast is available now at nplawcast.com/beyondthepodcast. - Newsletter subscribers… next week I’ll be releasing a free screencast on filling out the Form 990-N. If you’re not a subscriber, sign up at nplawcast.com/newsletter.
What triggers an audit? - To determine which organizations should be targeted, experienced specialists analyze information from Forms 990 and other sources. - This analysis will usually result in the selection of a group of returns for examination or compliance check. - EO also reviews media reports and receives complaints from the general public and Congress about potential non-compliance by exempt organizations. - After confirming the information, and when appropriate, these organizations may be selected for examination or to receive a compliance check. For details on how EO handles complaints about exempt organizations, see Fact Sheet 2008-13. (It goes to the Dallas field office, because Texans know how to investigate nonprofits, presumably?) - Regardless of the process used to select returns, EO does not presume that an organization is violating the tax laws before it begins the examination or sends a compliance check letter.
Closing Email me with questions and suggested topics Sign up for the free NLP newsletter… every week get the shownotes and resources sent to you by email, plus get additional free content on the laws impacting nonprofits. Go to nplawcast.com/newsletter for more info and to sign up. Need more than the podcast? Tim-Mooney.com and Beyond the Podcast at nplawcast.com nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law
Tim Mooney… Welcome to the Nonprofit Law Podcast Your guide to the laws impacting nonprofits. Shownotes…. nplawcast.com Email the show
News & Notes - Recommended resource if none of the lobbying talk makes sense: Alliance for Justice’s Worry-Free Lobbying for Nonprofits (PDF). - Nonprofits and Elections: Balancing Personal Versus Organizational Activity on-demand video screencast is available now at nplawcast.com/beyondthepodcast. What counts as lobbying for a public charity?
- Two sets of rules: one has no definitions, the other we’ll cover (“501(h) election”) - Do yourself a favor and check to see if your organization has made the 501(h) election – if not, strongly consider making it even if you engage in little or no lobbying activity - Direct Lobbying: - Communication - With a legislator - Expressing a view on specific legislation - Grassroots Lobbying: - Communication - With the general public - Expressing a view on specific legislation - With a call to action - A great deal of public advocacy is NOT lobbying, even though it is compelling, direct and (sometimes) rather pointed and critical - Many visits with legislators and their staff are NOT lobbying because the discussion centers on broad issues, not specific legislation - In doubt? Run your activity through the elements! Resources MNCN: Nonprofit Lobbying and the Law CLPI: Lobbying and the Law AFJ: State lobbying law resources and Worry-Free Lobbying for Nonprofits Closing Email me with questions and suggested topics Sign up for the free NLP newsletter… every week get the shownotes and resources sent to you by email, plus get additional free content on the laws impacting nonprofits. Go to nplawcast.com/newsletter for more info and to sign up. Need more than the podcast? Tim-Mooney.com and Beyond the Podcast at nplawcast.com nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law
Tim Mooney… Welcome to the Nonprofit Law Podcast Your guide to the laws impacting nonprofits. Shownotes…. nplawcast.com Email the show
News & Notes - Recommended blog: a great source of nonprofit news is The Chronicle of Philanthropy‘s Philanthropy Today. The Chronicle is a subscription service (and well worth it) but this is a free source of news from the Chronicle. I have it in my Google Reader so I get the stories delivered as soon as they are posted. - Nonprofits and Elections: Balancing Personal Versus Organizational Activity on-demand video screencast is available now at nplawcast.com/beyondthepodcast. The “L” word
- Yes, nonprofits can lobby - Yes, there are restrictions ranging from the substantial (private foundations) to the minimal (registration requirements for all) - Lobbying has a legal definition – there are many ways an organization can advocate (sometimes strongly) without it counting as lobbying - The basic rundown - Private foundations are essentially prohibited from lobbying, BUT there are many ways to visit legislators and educate (tax law) - Public charities are limited in the amount of lobbying they can engage in, but the amount allowed is surprisingly high for some (tax law) - Other 501(c)s are not limited at all in the amount of lobbying they can engage in, but it must fit their exempt purpose (tax law) - 527s rarely lobby because it is unusual that lobbying would support or oppose a candidate (their exempt purpose) - Federal law and most state laws require lobbyist registration for all (varies wildly – check your state) - Where things get tricky - Ballot measures – intersection with election laws - Local bodies of government – sometimes unclear whether there is legislation or a legislative body - Funder restrictions – the biggest area – a public charity may have a large legal capacity to lobby, but its source of funding may have contractual restrictions on lobbying so the nonprofit’s practical capacity is much lower Resources MNCN: Nonprofit Lobbying and the Law CLPI: Lobbying and the Law AFJ: State lobbying law resources Closing Email me with questions and suggested topics Sign up for the free NLP newsletter… every week get the shownotes and resources sent to you by email, plus get additional free content on the laws impacting nonprofits. Go to nplawcast.com/newsletter for more info and to sign up. Need more than the podcast? Tim-Mooney.com and Beyond the Podcast at nplawcast.com nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law
Tim Mooney… Welcome to the Nonprofit Law Podcast Your guide to the laws impacting nonprofits. Shownotes…. nplawcast.com Email the show
News & Notes – Nonprofits and Elections: Balancing Personal Versus Organizational Activity on-demand video screencast is available now at nplawcast.com/beyondthepodcast. Do all nonprofits have to file Form 990?
- No, but most do. The default is that your nonprofit will be filing a 990 about 5 months after the end of its tax year - Who doesn’t file a Form 990? - Small organizations - Gross receipts of less than $100,000 and assets of less than $250,000 at the end of the year (Form 990-EZ) - Gross receipts normally less than $25,000 (no filing necessary for FY 2007) - For FY 2008 (next year’s filing) these organizations may be required to file an annual electronic notice – e-Postcard - Churches and church-affiliated organizations (no filing necessary) - Private foundations (Form 990-PF) - Employee benefit trusts (Form 5500) - Black lung benefit trusts (Form 990-BL) - Special partnerships of religious and apostolic organizations (Form 1065). Resources IRS: EO Reporting Requirements – Annual Return Filing Exceptions Closing Email me with questions and suggested topics Sign up for the free NLP newsletter… every week get the shownotes and resources sent to you by email, plus get additional free content on the laws impacting nonprofits. Go to nplawcast.com/newsletter for more info and to sign up. Need more than the podcast? Tim-Mooney.com and Beyond the Podcast at nplawcast.com nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law
Tim Mooney… Welcome to the Nonprofit Law Podcast
Your guide to the laws impacting nonprofits.
Shownotes…. nplawcast.com Email the show
News & Notes - What’s the IRS up to this year? According to its 2008 guidelines (PDF), the IRS is going to be focusing on (1) the redesign of Form 990, and (2) efforts to reign in abusive donation transactions particularly over-valuation of non-cash contributions. More at Guidestar.org.
- Nonprofits and Elections: Balancing Personal Versus Organizational Activity on-demand video screencast is available now as special preview for newsletter subscribers and will be available February 10th for the rest of the listenership. More on newsletter signup at the end of the show. Can a candidate use our space?
- 501(c)(4)s, etc.
- Yes, and you can limit it in a partisan way
- If limited in a partisan manner, this will count toward your limits on partisan activity under tax law
- Use must be incidental (about an hour per week or 4 hours per month) or it might be considered a contribution unless candidate reimburses (federal candidates – state law varies widely)
- 501(c)(3)s
- Must be strictly nonpartisan (nonpartisan debates, etc.) OR
- The use is part of a community offering (church rec room or community room) that is regularly made available for noncommercial purposes, without regard to political affiliation
- You can charge fees Resources FEC: Citizens’ Guide
IRS: CPE Guide, Election Year Issues (PDF – p383)
Closing Email me with questions and suggested topics
Sign up for the free NLP newsletter… every week get the shownotes and resources sent to you by email, plus get additional free content on the laws impacting nonprofits. Go to nplawcast.com/newsletter for more info and to sign up.
Need more than the podcast? Tim-Mooney.com and Beyond the Podcast at nplawcast.com nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law.
Tim Mooney… Welcome to the Nonprofit Law Podcast
Your guide to the laws impacting nonprofits.
Shownotes…. nplawcast.com Email the show
News & Notes Welcome Blue Oregon readers
Sign up for the free NLP newsletter… every week get the shownotes and resources sent to you by email, plus get additional free content on the laws impacting nonprofits. Go to nplawcast.com/newsletter for more info and to sign up.
Nonprofits and New Media: Legal Rules for using the Internet, Podcasts and Social Networks is available.
Next Beyond the Podcast offering: Nonprofits and Elections: Balancing Personal Activity versus Organizational Activity. Available on January 31st for newsletter subscribers who will receive a discount through February 10th when it will be released to the rest of the listenership.
Nonprofits and New Media: Legal Rules for using the Internet, Podcasts and Social Networks is available.
Check out the poll at the bottom of the Beyond the Podcast page at nplawcast.com and give your input on what topics you’d like covered in the some of the next BTP offerings.
Unrelated Business Income - Listener suggestion: issues regarding the parking garage run by a nonprofit – is it subject to taxation? - Any income an organization receives from a regular trade or business that is not substantially related to the organization’s exempt purposes.
- trade or business can be a small part of overall work (i.e. NYU and Mueller Spaghetti)
- regularly carried on: has a frequency (not a one-shot)
- substantially related – if the sales don’t somehow advance the exempt purposes of the organization
- IRS uses facts and circumstances analysis
- Affects most 501(c) organizations
- Subjects them to a tax – “UBIT”
- New rule: organizations have to make their UBIT returns (Form 990T) available to the public!
- Examples
- membership list sales: UBIT
- pet boarding by an anti-cruelty org: UBIT
- art museum gift cards with art: not UBI
- newsletters/magazines: can go either way (depends on whether the articles cover the exempt purpose)
Resources IRS: Publication 598 (PDF – newly updated)
IRS: UBI defined
BoardSource: What is UBIT?
Closing
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law
Tim Mooney… Welcome to the Nonprofit Law Podcast Your guide to the laws impacting nonprofits. Shownotes…. nplawcast.com Email the show
News & Notes Sign up for the free NLP newsletter… every week get the shownotes and resources sent to you by email, plus get additional free content on the laws impacting nonprofits. Go to nplawcast.com/newsletter for more info and to sign up. Nonprofits and New Media: Legal Rules for using the Internet, Podcasts and Social Networks is available. Early reviews are great, and I’m glad it’s been well-recieved. Check out the poll at the bottom of the Beyond the Podcast page at nplawcast.com and give your input on what topics you’d like covered in the some of the next BTP offerings. I’ll announce the next BTP topic next show. Nonprofit Mailing Rates - Why would you want it? Cheap mailings – 40% of standard mail rates - Who qualifies? Mainly (c)(3)s and some very limited political committees (i.e. official Dem and GOP committees) – but qualified orgs do not have to be 501(c)(3)s - How to apply –
- Determination letter, supporting docs of activity
- Financial statements, etc. - Not an insignificant form - Congrats – you’re approved… now what? - What can be mailed is strictly controlled - Off limits - Certain advertisements - Mailing other org’s mail (that includes affiliated (c)(4)s and 527s!) - Mailing without identifying marks - Make sure you mail at least once every 2 years (200 pieces or 50 lbs) - Story time… the Portland Post Office vs. a suburban Minneapolis Post Office Resources USPS: NetPost Mailing Online – Nonprofit FAQs USPS:
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law.
Tim Mooney… Welcome to the Nonprofit Law Podcast Your guide to the laws impacting nonprofits. Shownotes…. nplawcast.com Email the show
News & Notes Sign up for the free NLP newsletter… every week get the shownotes and resources sent to you by email, plus get additional free content on the laws impacting nonprofits. Go to nplawcast.com/newsletter for more info and to sign up. Nonprofits and New Media: Legal Rules for using the Internet, Podcasts and Social Networks is available. Early reviews are great, and I’m glad it’s been well-recieved. Check out the poll at the bottom of the Beyond the Podcast page at nplawcast.com and give your input on what topics you’d like covered in the some of the next BTP offerings. New Year, New Changes? A lot of nonprofits consider making changes to their organization – new offerings, new services, new board members… even new addresses How do you handle letting the IRS know about these things? Form 990 – your annual return generally contains places in the form to include any of the ordinary changes that happen with nonprofits new address, new board members, new officers, etc. What about bigger changes In some instances, bigger changes require more information to supplement the 990 – for instance, if your nonprofit reincorporates, you would need to attach the new articles of incorporation to the Form 990 What about super-big changes? If your nonprofit is changing its services or mission dramatically, it might require additional action Private Letter Ruling – a lengthy process with the IRS asking for specific advice on a specific matter. Get a lawyer! Another 1023 – sometimes the changes are so big that you might as well be a new organization (i.e. a totally different exempt purpose than the one you applied for recognition in the first place) This would be due to big changes… going from private foundation to public charity, or nonrelgious organization to a religious one that is exempt from filing 990s, etc.
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law.
Tim Mooney… Welcome to the Nonprofit Law Podcast Your guide to the laws impacting nonprofits. Shownotes…. nplawcast.com Email the show
News & Notes We’re going on holiday schedule into the new year… we’ll have new editions every other week. Happy new year! Sign up for the free NLP newsletter… every week get the shownotes and resources sent to you by email, plus get additional free content on the laws impacting nonprofits. Go to nplawcast.com/newsletter for more info and to sign up.
Beyond the Podcast - Nonprofits are generally underserved in how they approach the regulations and laws because there’s a dearth of services out there that are reasonable for nonprofit budgets - I’ve been very happy with the response to the show… but it’s always a bit frustrating to see the gap between what people can get between a 10 minute show and hiring a lawyer - So, let’s fill that gap and go “Beyond the Podcast” - The Nonprofit Law Podcast will always remain a free resource for nonprofit staff, officers and professionals. Beyond the Podcast will feature options for those who want to go “beyond the podcast” to dig into some of the topics in greater detail. It will stay low-cost – we want to make these easy for even the smallest community nonprofit to afford. - We’ll be launching this on January 7, 2008… but if you are a newsletter subscriber you get an early shot at our first production – Nonprofits and New Media: Legal Rules for using the Internet, Podcasts and Social Networks Nonprofits and New Media DVD - Remember all the way back in #6 when this was announced? - Evolved from an audioguide to a screencast… to a DVD - 90 minutes of training - Join Tim Mooney, a nonprofit attorney with over a decade of experience, for an overview of the laws impacting the use of new media by nonprofits. What does tax law have to say about your organization’s podcast and MySpace page? Are there federal election law implications to your get-out-the-vote efforts to your membership listserve? What kind of copyright issues does your nonprofit face when it uses other people’s photos on its blog? All of these questions, and more, on the first in NLP’s Beyond the Podcast series. - Sign up for the NLP newsletter now and get this early plus get a $10 discount – nplawcast.com/newsletter - Otherwise, keep your eyes peeled to nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law.
Tim Mooney… Welcome to the Nonprofit Law Podcast Your guide to the laws impacting nonprofits. Shownotes…. nplawcast.com Email the show
News & Notes We’re going on holiday schedule through the end of the year… we’ll have new editions every other week through the end of the year. Happy holidays! Sign up for the free NLP newsletter… every week get the shownotes and resources sent to you by email, plus get additional free content on the laws impacting nonprofits. Go to nplawcast.com/newsletter for more info and to sign up.
What should we be doing at the end of a fiscal year? Listener question… It’s big enough of a task to be mentioned alone: recordkeeping. It’s the law It’s a good management tool It can protect you against false accusations by others that would like to make your organization’s existence more difficult
Corporate record book
Make one if you don’t have it… a binder with all of your important docs IRS determination letter, articles of Incorporation, bylaws, and minutes of board meetings This should be permanently kept and updated when necessary Remember some of these documents must be made publicly available, so this is an important one
Lobbying and other reporting information
Keep track of hours of lobbying as a 501(c)(3) Keep track of amount of partisan activity as a 501(c)(4) You’ll need this for your 990 in the spring
Financial records
Bank statements, old Form 990s, internal reports by treasurers, etc. Keep these for at least seven years (law requires 3 for some, like the 990s)
Make sure you are keeping up with donor receipts for end of the year appeals!
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law.
Tim Mooney… Welcome to the Nonprofit Law Podcast Your guide to the laws impacting nonprofits. Shownotes…. nplawcast.com Email the show
News & Notes We’re going on holiday schedule through the end of the year… we’ll have new editions every other week through the end of the year. Happy holidays! Sign up for the free NLP newsletter… every week get the shownotes and resources sent to you by email, plus get additional free content on the laws impacting nonprofits. Go to nplawcast.com/newsletter for more info and to sign up.
Charitable solicitation registration Listener question… The piece a lot of nonprofits forget A function of state law (sometimes even municipal!) 43 states plus DC require it Make sure you are registered in your “domiciled” state if it’s required The big question… if we ask for donations on our website, do we have to file in every state? Answer… technically, it depends on EACH state’s laws on contacts and solicitation, so you may technically have to depending on your activities Huge expense and a huge hassle Practical answer… few states are going after non-filers if their only “contact” is a potential one Practical solution… file in states that you are targeting or have some kind of a real presence Consider using the Multistate Filing form Resources Idealware.org Multistate Filing form Closing
Email me with questions and suggested topics Screencast on using the Internet, podcasting and social networking for your nonprofit – go to nplawcast.com for details Need more than a podcast? Tim-Mooney.com nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law.
Tim Mooney… Welcome to the Nonprofit Law Podcast Your guide to the laws impacting nonprofits. Shownotes…. nplawcast.com Email the show
News & Notes We’re going on holiday schedule through the end of the year… we’ll have new editions every other week through the end of the year. Happy holidays! Sign up for the free NLP newsletter… every week get the shownotes and resources sent to you by email, plus get additional free content on the laws impacting nonprofits. Go to nplawcast.com/newsletter for more info and to sign up.
When should a nonprofit amend its IRS tax return Generally, not often – since there are no refunds to consider there is usually no economic advantage to doing it Only if there is a substantial error 501(c)(3) that checks the box saying it engaged in political activity 501(c)(3) that exceeded its lobbying limits, only to later discover it did not and would like the excise taxes returned 501(c)(4) that miscalculated the amount of political activity it engaged in Other substantial errors in reporting (income, etc.) Missing schedules of a return Best practices – write “ameded return” on the top of every page of the return in addition to checking the appropriate box for amended return on page 1
Closing
Email me with questions and suggested topics Screencast on using the Internet, podcasting and social networking for your nonprofit – go to nplawcast.com for details Need more than a podcast? Tim-Mooney.com nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law.
Tim Mooney… Welcome to the Nonprofit Law Podcast Your guide to the laws impacting nonprofits. Shownotes…. nplawcast.com Email the show
News & Notes Kudos to Corey and 501(c)(3) podcast… he’s taking on a new job and moving, which means a brief hiatus for his show. We all look forward to his return to podcasting in January. Sign up for the free NLP newsletter… every week get the shownotes and resources sent to you by email, plus get additional free content on the laws impacting nonprofits. Go to nplawcast.com/newsletter for more info and to sign up.
Help!! I lost my 501(c)(3) letter! It’s important – public charities are asked for copies of their letter ALL the time Before you lose it… scan and post it to your website in a “secret” place IF you lose it… don’t panic Form 4506-A (PDF) IRS Tax Exempt and Government Entities (TE/GE) Customer Account Services at (877) 829-5500 Resources IRS.gov/eo IRS Tax Exempt and Government Entities (TE/GE) Customer Account Services at (877) 829-5500
Closing
Email me with questions and suggested topics Screencast on using the Internet, podcasting and social networking for your nonprofit – go to nplawcast.com for details Need more than a podcast? Tim-Mooney.com nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law.
Tim Mooney… Welcome to the Nonprofit Law Podcast Your guide to the laws impacting nonprofits. Shownotes…. nplawcast.com Email the show
What the heck is D&O insurance, and do we need it? Directors and Officers Insurance Does NOT cover everything under the sun Covers breaches of duty to the nonprofit by directors and officers D&O pays for “wrongful acts.” D&O insurance usually covers: * Employment-discrimination, harassment, and wrongful termination * Failure to provide services to parties * Mismanagement of assets (negligence, etc.) D&O insurance usually does NOT cover: * bodily injury * property damage * other torts on your premises/property Other insurance, (usually general liability) covers these claims. Insurance is lawyer coverage as much as it is claim coverage
Email me with questions and suggested topics Screencast on using the Internet, podcasting and social networking for your nonprofit – go to nplawcast.com for details Need more than a podcast? Tim-Mooney.com nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law.
Tim Mooney… Welcome to the Nonprofit Law Podcast Your guide to the laws impacting nonprofits. Shownotes…. nplawcast.com Email the show
Month long series on election activity
Focuses on public charities, other 501(c)s and 527s Covering voter guides, debates & forums, renting mailing lists, ballot measures, and voter registration/GOTV Why now? Many nonprofits are already planning 2008 and some are already engaged in it Don’t do any of these things? Still important to know in case something unexpected comes up
Voter registration -registering people to vote GOTV – getting people to the polls, or otherwise aiding them to vote
501(c)(3)s Purely nonpartisan One permissible goal – getting people to exercise their right to vote Permissible to target activities if based on nonpartisan criteria like location and audience May not target based upon the way a group votes May target if a disadvantaged or underrepresented group or targeted group has common interest Do discuss a broad range of issues Don’t suggest a correct position Vote green. Register here. – NO You can have an impact on the decisions affecting your life. Register to vote now. – YES Let’s get out the pro-choice vote. Register here. – NO
Other 501(c)s Partisan “slant” ok, but it would then count towards secondary activity, so watch amount 527s Partisan “slant” ok Resources
Email me with questions and suggested topics AP audio & handbook on using the Internet, podcasting and social networking for your nonprofit – go to nplawcast.com for details Need more than a podcast? Tim-Mooney.com nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law.
Tim Mooney… Welcome to the Nonprofit Law Podcast Your guide to the laws impacting nonprofits. Shownotes…. nplawcast.com Email the show
Month long series on election activity
Focuses on public charities, other 501(c)s and 527s Covering voter guides, debates & forums, renting mailing lists, ballot measures, and voter registration/GOTV Why now? Many nonprofits are already planning 2008 and some are already engaged in it Don’t do any of these things? Still important to know in case something unexpected comes up
Ballot Measures Also, referenda, ballot questions, bond measures, state questions, etc. Legislation that is considered by voters Work for or against is considered a hybrid… lobbying by tax law, election activity by state election law
501(c)(3)s Limited capacity to work on ballot measures Reporting requirements and registration usually required under state laws Other organizations? Lobbying not an issue under tax law Reporting requirements and registration usually required under state laws Resources
Email me with questions and suggested topics AP audio & handbook on using the Internet, podcasting and social networking for your nonprofit – go to nplawcast.com for details Need more than a podcast? Tim-Mooney.com nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law.
Tim Mooney… Welcome to the Nonprofit Law Podcast Your guide to the laws impacting nonprofits. Shownotes…. nplawcast.com Email the show
Month long series on election activity
Focuses on public charities, other 501(c)s and 527s Covering voter guides, debates & forums, renting mailing lists, ballot measures, and voter registration/GOTV Why now? Many nonprofits are already planning 2008 and some are already engaged in it Don’t do any of these things? Still important to know in case something unexpected comes up
501(c)(3)s can rent their mailing lists to candidates!? A 501(c)(3) may rent mailing lists to political candidates Must make the list available to all candidates IRS is likely to look less favorably on such list rentals if the 501(c)(3) does not make such lists available to the public on a regular basis on the same terms that the lists are made available to candidates Best practices – use a list broker Other organizations? Less of an issue since they can support or oppose candidates Watch out for contribution prohibitions
Email me with questions and suggested topics Audio guide on using the Internet, podcasting and social networking for your nonprofit coming soon- go to nplawcast.com for details Need more than a podcast? Tim-Mooney.com nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law.
Tim Mooney… Welcome to the Nonprofit Law Podcast Your guide to the laws impacting nonprofits. Shownotes…. nplawcast.com Email the show
Month long series on election activity
Focuses on public charities, other 501(c)s and 527s Covering voter guides, debates & forums, renting mailing lists, ballot measures, and voter registration/GOTV Why now? Many nonprofits are already planning 2008 and some are already engaged in it Don’t do any of these things? Still important to know in case something unexpected comes up
Debates & forums
Debate – multiple candidates on “stage” at same time Forum – one at a time appearance
501(c)(3)s Purely nonpartisan Broad range of issues Unbiased questions Invite all viable candidates Apply the rules fairly Impartial moderator Unbiased audience Forums – no contextual favoritism Special issue – inviting candidate for non-candidate reason (award, etc.) ok so long as it is not timed to coincide with the election Other 501(c)s Partisan “slant” ok, but it would then count towards secondary activity, so watch amount 527s Forums and rallies typical Resources
Email me with questions and suggested topics Audio guide on using the Internet, podcasting and social networking for your nonprofit coming later this week – go to nplawcast.com for details. Need more than a podcast? Tim-Mooney.com nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law.
Tim Mooney… Welcome to the Nonprofit Law Podcast Your guide to the laws impacting nonprofits. Shownotes…. nplawcast.com Email the show
Month long series on election activity
Focuses on public charities, other 501(c)s and 527s Covering voter guides, debates & forums, renting mailing lists, ballot measures, and voter registration/GOTV Why now? Many nonprofits are already planning 2008 and some are already engaged in it Don’t do any of these things? Still important to know in case something unexpected comes up
Voter guides
501(c)(3)s Purely nonpartisan IRS safe harbor… reprint candidate questionnaire No pledges Broad range of issues IRS: Too easy to make any candidate look good or bad when focusing on a single issue Position on one issue should not suggest position on another Several issues: four? five? more? Distribute to all Unbiased questions No editing Other 501(c)s Partisan “slant” ok, but it would then count towards secondary activity, so watch amount 527s Generally comparing and contrasting issue differences before a targeted distribution (i.e. NRA PAC comparing gun positions to NRA members) Resources
Email me with questions and suggested topics Audio guide to using the Internet, podcasting and social networking for your nonprofit – go to nplawcast.com for details next week Need more than a podcast? Tim-Mooney.com nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law.
Tim Mooney… Welcome to the Nonprofit Law Podcast
Your guide to the laws impacting nonprofits.
Shownotes…. nplawcast.com Email the show
Month long series on election activity
Focuses on public charities, other 501(c)s and 527s Covering voter guides, debates & forums, renting mailing lists, ballot measures, and voter registration/GOTV
Why now? Many nonprofits are already planning 2008 and some are already engaged in it
Don’t do any of these things? Still important to know in case something unexpected comes up
The basics
501(c)(3)s Absolute prohibition on supporting or opposing candidates for public office
Nonpartisan work allowed (education, voter registration, GOTV, etc.)
Ballot measure work ok (lobbying) but follow state laws
Other 501(c)s Secondary activity
Follow election laws (many prohibit express advocacy, almost all prohibit contributions) Ballot measure work ok (lobbying) but follow state laws
527s Organized to impact elections
Reporting requirements on state and federal level vary
Some register as political committees/PACs, others don’t and are limited in what they can do (but this reduces reporting and accountability)
Email me with questions and suggested topics
AP audio & handbook on using the Internet, podcasting and social networking for your nonprofit coming soon
Need more than a podcast? Tim-Mooney.com nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law.
Tim Mooney… Welcome to the Nonprofit Law Podcast Your guide to the laws impacting nonprofits. Shownotes…. nplawcast.com Email the show
NLP News
Now a top 15 show in iTunes… thank you listeners Pass along the links to your colleagues who might be interested… 5-10 minutes per week, and I take requests on topics!
Listener request – who gets to see what?
- “For entertainment, some people in this town make trouble.” - Who gets to see bylaws, articles of incorporation, minutes, financial reports, etc? - Generally, you’re a private org and nobody has access to records other than proscribed by law - Federal tax law… we covered in ep 4 - Virtually everything else is dependent on state and local laws - Some states require additional disclosure through solicitation laws (ex. OR, WA) - Even some munis require enhanced disclosure of records if you do business with them (ex. SF) - Most states have public access to corporate records online, but not things like bylaws etc. - Bylaws rule the rest (member or public access to records, etc.)
Tips & Best practices
- Check state and local laws - Be very aware of solicitation registration rules - If someone asks for records other than ones they are entitled to, and cannot show you the legal reason why they are entitled to them, you have the right to refuse the request - Sometimes document requestors bear no ill-will (academics, etc.). Choose your battles.
Closing
Email me with questions and suggested topics AP audio & handbook on using the Internet, podcasting and social networking for your nonprofit coming soon Need more than a podcast? Tim-Mooney.com nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law.
Tim Mooney… Welcome to the Nonprofit Law Podcast Your guide to the laws impacting nonprofits. Shownotes…. nplawcast.com Email the show
What are the changes coming for small nonprofits? - Form 990N… the “e-postcard” - Previously, tax-exempt organizations with gross receipts of $25,000 or less were not required to submit information returns. Beginning next year, they will file the Form 990N. - Short, easy and electronic - Provide a legal name and mailing address, any other names used, a Web address if one exists, the name and address of a principal officer and a statement confirming the organization’s annual gross receipts are normally $25,000 or less. Tips & Best practices
- Continue to track those finances! - Be aware there will be slightly more paperwork to file (versus none!) - Remember… organizations shouldn’t ignore filing the 990N, or they risk losing their tax-exempt status - Info on the reporting system is forthcoming… we’ll be on top of it here at the Nonprofit Law Podcast - Make sure the gross receipts are not exceeding $25,000… if so, you’ve graduated to 990EZ or 990!
Email me with questions and suggested topics AP audio & handbook on using the Internet, podcasting and social networking for your nonprofit coming later this summer Need more than a podcast? Tim-Mooney.com nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law.
Tim Mooney… Welcome to the Nonprofit Law Podcast Your guide to the laws impacting nonprofits. Shownotes…. nplawcast.com Email the show
When is a person acting on their own versus acting on behalf of their organization?
- Joining a nonprofit as a director or a staff member doesn’t take away your individual rights - Individuals can do things that are otherwise forbidden… donate time/money to campaign, etc. - General rule – so long as an organization’s financial resources, facilities, or staff are not used, the organization is not going to be beholden to the individual acts of its staff, officers or directors When do the actions become attributed to an organization? - Principles of agency are used… if the person acts as if they have power, and they actually do have the power, the IRS will usually consider the action that of the organization - Actions of individuals that weren’t ok’d by the group, but were later “implicitly ratified.” (i.e. Organization found out about the actions and did not disavow them)
Tips & Best practices
- Have a policy in place on use of organizational resources - Encourage use of disclaimers for individuals working on non-organizational endeavors (i.e. “organization shown for identification purposes only”)
Resources
Election Year Issues (pp. 363-365) – IRS CPE Text Election Year Activities for Section 501(c)(3) Organizations: Frequently Asked Questions – McDermott Will & Emery Closing
Email me with questions and suggested topics AP audio & handbook on using the Internet, podcasting and social networking for your nonprofit coming later this summer Need more than a podcast? Tim-Mooney.com nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law.
Tim Mooney… Welcome to the Nonprofit Law Podcast Your guide to the laws impacting nonprofits. Shownotes…. nplawcast.com Email the show
Fiscal Sponsors
501(c)(3)s that take a new project under its wing to offer tax advantages to the project Typical route for startup nonprofits Funds are given to the existing 501(c)(3) for it to control Agreements in place to ensure the funds that come to the fiscal sponsor are spent on the project Sponsors are legally allowed to retain a small amount of money for administrative expenses incurred Many agreements have out clauses if the project is recognized as a 501(c)(3) Tips
Make sure you have a good agreement If you are a sponsor, understand that this project is part of your organization If you are the project, find a good sponsor fit
Email me with questions and suggested topics AP audio & handbook on using the Internet, podcasting and social networking for your nonprofit coming later this summer Need more than a podcast? Tim-Mooney.com nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law.
Tim Mooney… Welcome to the Nonprofit Law Podcast Your guide to the laws impacting nonprofits. Shownotes…. nplawcast.com Email the show
Restricted funds
Government grants – can’t lobby with the funds Statutory limits – part of a charter, sometimes limits activity Grant agreements – contractual agreements that limit use of the money
In many circumstances, the limits run with the money – if you use money from outside of that pool, you are allowed to lobby.
Example: A 501(c)(3) organization receives 40% of its funding from federal grants, and an additional 40% of its funding from private foundation grants that have a restrictive clause for lobbying as a part of the agreement. Can the organization lobby?
Answer: Yes, so long as the organization complies with the limits to lobbying as a part of its tax status.
Email me with questions and suggested topics AP audio & handbook on using the Internet, podcasting and social networking for your nonprofit coming later this summer Need more than a podcast? Tim-Mooney.com nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law.
Tim Mooney… Welcome to the Nonprofit Law Podcast Your guide to the laws impacting nonprofits. Shownotes…. nplawcast.com Email the show
Threshold question… do we need a nonprofit?
Is this a long-term project? Do you envision this living beyond your involvement? How big is the endeavor? Will you be accepting money or goods from others – how much? Do you want to work with others to make this happen? Are you replicating the work of another nonprofit?
Resources
“Can I” vs. “Should I”: Center for Nonprofit Corporations (pdf)
Closing
Email me with questions and suggested topics AP audio & handbook on using the Internet, podcasting and social networking for your nonprofit coming later this summer Need more than a podcast? Tim-Mooney.com nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law.
Tim Mooney… Welcome to the Nonprofit Law Podcast Your guide to the laws impacting nonprofits. Shownotes…. nplawcast.com Email the show
“I was told there’d be no math on this exam” - Ethan Hawke as Tom Dyer, Reality Bites
If you are a public charity, you have to show public support if you’re not a church or a school. This can be a complicated area because there are several, math-intensive ways of determining public support MOST organizations will qualify under IRC Sec. 509(a)(1)… the 1/3 test If after we go through this test and you determine your organization doesn’t meet the 1/3 test, don’t panic… you may meet it under another test, but it’s time to contact a tax professional (lawyer or accountant)
Why public support?
Practically, it shows your charity gets a lot of small contributions to make up its total support. It demonstrates broad fiscal commitment from the community to your organization, and therefore makes you worthy of tax exempt status with all the benefits of a charity.
Who cares if you lose it?
You’re now a private foundation… still exempt, but with more hassles It’s harder to offer tax deductibility to contributors Your paperwork just went sky high (990PF) No lobbying at all Taxes on investments
The 1/3 test
Step 1 – Figure out the threshold amount. For your tax year, multiply your total support by .02 – this gives you the magic number that the IRS considers the maximum contribution that qualifies as public support.
Step 2 – add up all of the contributions you received that are LESS than that threshold amount. We’ll call that qualifying support.
Step 3 – Divide qualifying support by total support. Note that any big grants or individual contributions that don’t make it in the numerator are in the denominator… If the total percentage is greater than 33.3%, congratulations… you pass. If not… take a deep breath and call your tax professional. You may qualify under another test OR it might be possible to push for small donors if you are working with projected numbers in your current tax year
Other things to think about
New charities are given 4-6 years to meet the public support test Tipping is not for waiters. It’s when you get a big donation from one source that is so big that it causes your organization to fail the public support test.
Email me with questions and suggested topics AP audio & handbook on using the Internet, podcasting and social networking for your nonprofit coming later this summer Need more than a podcast? Tim-Mooney.com nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law.
Tim Mooney… Welcome to the Nonprofit Law Podcast Your guide to the laws impacting nonprofits. Shownotes…. nplawcast.com Email the show
Voter scorecards Now that many states have finished their legislative sessions, some nonprofits publish the results of votes on bills There are some rules to follow, especially if your nonprofit is a publich charity 501(c)(3) IRS treats this activity as potential election activity, so tread carefully If your charity is a 501(c)(4) or a labor union, or trade association, these rules don’t apply… you’re largely free to publish in any way
Voter scorecards to the public Just the facts… all vanilla No editorializing allowed Broad range of issues
Voter scorecards to members Members are donors and people who have volunteered more than a nominal amount of time to the organization Editorializing is allowed Narrow range of issues important to the organization
Final note These are the safe harbors… if you deviate from them as a 501(c)(3) you’re in the murky “facts and circumstances” area
Email me with questions and suggested topics AP audio & handbook on using the Internet, podcasting and social networking for your nonprofit coming later this summer Need more than a podcast? Tim-Mooney.com nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law.
Tim Mooney… Welcome to the Nonprofit Law Podcast Your guide to the laws impacting nonprofits. Shownotes…. nplawcast.com Email the show
Using MySpace and other social networking sites Great new tool Allows for two way communication with your members and constituents It’s a public communication usually, so you need to be mindful that there are some things nonprofits cannot be involved in
Profile This is the description of the organization… make sure it adequately represents your organization and doesn’t contain any overt political statements that could be seen as supporting or opposing candidates!
Friending Typically, members of a social network “friend” each other… it’s also used to create a fanbase (i.e. bands, companies, etc.) In the nonprofit context, it’s used to show support for a set of issues Friends can post messages on your site… this can create problems if the friends post material that doesn’t fit the nonprofit’s message, or worse, if it is illegal Options – (1) Set your profile so that all messages must be approved by an admin first (2) Only friend people that are known quantities (3) Make the entire profile hidden to the public (i.e. you have to be a “friend” to read your page)
Other issues
Special rules for members Copyright Rights of publicity All will be covered in the upcoming AP guide – Nonprofits and New Media: Legal Rules for using the Internet, Podcasts and Social Networks
Email me with questions and suggested topics AP audio & handbook on using the Internet, podcasting and social networking for your nonprofit coming later this summer Need more than a podcast? Tim-Mooney.com nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law.
Tim Mooney… Welcome to the Nonprofit Law Podcast Your guide to the laws impacting nonprofits. Shownotes…. nplawcast.com Email the show
Common characteristics
All are tax exempt All have some kind of legal form in a state These are federal tax law designations (numbers correspond to the tax code)
Public charities – 501(c)(3)
Support “charitable, religious, educational, scientific, literary, testing for public safety, fostering national or international amateur sports competition, and the preventing cruelty to children or animals.” Have a certain level of public support (many small contributors… this is a future show!) Donors get tax deductions No support or opposition to candidates (future show) Limited lobbying (future show)
i.e. Red Cross, American Cancer Society, etc.
Private foundations – 501(c)(3)
Same as a public charity, but they get their money from a limited source (can’t show public support) i.e. Bill and Melinda Gates Foundation, Ford Foundation, etc.
Social Welfare – 501(c)(4)
Donors do not get tax deductions Unlimited lobbying… tend to be advocacy groups Limited election work (secondary activity) i.e. Sierra Club, …
Unions and Labor Organizations – 501(c)(5) and Trade Associations – 501(c)(6)
Same rules as 501(c)(4)s
Political Organizations – 527s
PACs, political parties, formerly “Stealth PACs” All activity goes towards the election or defeat of a candidate or ballot measure VERY complicated because of the overlay with state or federal election laws If you wade in this thicket, make sure you have a lawyer advising you!
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law.
Tim Mooney… Welcome to the Nonprofit Law Podcast Your guide to the laws impacting nonprofits. Shownotes…. nplawcast.com Email the show
Background
Nonprofits get preferential tax treatment The tradeoff for that preferential tax treatment comes in a few ways… one of them is public disclosure of information
The basic rules
Public charities have to give over, upon request their tax returns from the last three years (Form 990s) and their application for recognition of exemption (Form 1023).
If someone comes in and requests in-person, you must provide these documents then and there.
If the request comes in writing, email or phone, you have 30 days to produce the documents.
You may charge reasonable copying costs… details on that in a resource I’ll mention later in the show.
There are some major exceptions to keep in mind… so pay attention to what your organization does not have to turn over upon request as much as you pay attention to what your organization is obligated to provide.
You can always give more information to the public if you want.
Tax return
- Form 990 - Any attachments, and - All schedules,
Exception… you don’t have to turn over contributors names… you may legally black out/redact the names of contributors in Schedule B and any identifying information in Schedule B Part II.
NEVER let anyone browbeat you into providing that information. It is confidential and legally protected.
Application
- A copy of the organization’s Form 1023 (if a 501(c)(3)) or 1024 (if another 501(c) org) - All attachments - All supporting documents, and - Any communications with the IRS sent about the application
Exception…. If the organization is older than July 15, 1987 and you don’t have a copy of the application, you do not need to turn it over. As of July 15, 1987 all nonprofits filing a 1023 or 1024 were required to hold onto those applications. You should have them!
Email me with questions and suggested topics AP audio & written guides coming soon Need more than a podcast? tim-mooney.com I look forward to bringing the information to the community Thank you for joining me on the nonprofit law podcast… take care. nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law.
Tim Mooney… Welcome to the Nonprofit Law Podcast Your guide to the laws impacting nonprofits. Shownotes…. nplawcast.com Contact
Is it time to dust off your bylaws?
Your bylaws are important
Things to look at: Committees… meetings… notice requirements… board terms
Time to change? Maybe… Has your organization changed?
Change in your mission Change in organization operation – do you really still follow the annual meeting procedures? Need to update? – How do your bylaws handle resignations or other situations where a board member leaves? – How do you handle members or constituents you serve? Do they have a voice on the board, or should the board really be insulated from it?
Email me with questions and suggested topics AP audio & written guides coming soon Need more than a podcast? Tim-Mooney.com I look forward to bringing the information to the community Thank you for joining me on the nonprofit law podcast… take care. nplawcast.com
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law.
Your guide to the laws impacting nonprofits. Shownotes…. nplawcast.com Email the show
Topic from a listener… tips on starting a nonprofit
Volunteers Startups rely almost exclusively on heart and volunteer efforts. Make sure you have a dedicated base of volunteers and a *very* dedicated board. You’ll be relying on them a lot over the course of the first year.
IRS Getting nonprofit corporate status in your state is a piece of cake… in some instances it can take as little as 24 hours. Getting the IRS to recognize your tax-exempt status is a *much* longer process, and you need to factor that into your planning. Right now it’s taking the IRS 9-12 months to process applications… some people won’t give charitable contributions until that process is done, so it definitely affects fundraising.
Lawyers? A lawyer is not necessary, but as with all things in life, getting a pro to help you can be really useful. The problem is that there are a lot of lawyers out there, but very few that have much training or experience in nonprofit laws. If you can find one that isn’t already maxed to capacity (raising my hand on that!) and he or she is interested in your work, by all means ask them to be on your board!
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law.
This podcast provides general information about legal topics but it is not a complete discussion of all legal issues that arise in relation to nonprofits nor is it a substitute for legal advice. This podcast does not create an attorney-client relationship. This is general legal information and the contributors make no warranties regarding the general legal information provided in this podcast , and disclaim liability for damages resulting from its use to the fullest extent permitted by the applicable law.
