The Housing Rescue and Foreclosure Act of 2008 — which President Bush signed into law July 30 — includes the creation of a permanent Housing Trust Fund that will provide as much as $300-million a year to increase the supply of low-income housing, especially rental units.

Money from the fund can be granted directly to nonprofit housing groups.

The National Low-income Housing Coalition, a charity in Washington, started a campaign to promote the creation of such a fund back in 2000. The campaign’s goal is to preserve and produce some 1.5 million affordable housing units over 10 years.

Some conservative lawmakers and groups have objected to the Housing Trust Fund component of the largely foreclosure-focused law, fearful that money could be channeled to charities with political (and left-leaning) agendas.

The law is the federal government’s most sweeping response yet to the...

The Internal Revenue Service has told an organization that says it operates “for the advancement of Christianity and for other charitable purposes” that it does not qualify for a federal tax exemption as a church under Section 501(c)(3) of the U.S. tax code.

In its application for tax-exempt status, the organization said it conducts some “street ministry” activities, expects to rent a building and buy equipment to hold indoor services, and might one day start a religious school to educate young people.

The group said its board of directors has four members: its pastor, who is the founder and board chairman; his wife, who is the co-chair, secretary, and treasurer; a son, who is assistant secretary; and another son.

In its ruling, the IRS noted that no definition of “church” appears in the Internal Revenue Code.

However, the tax agency and federal courts have identified several...

The Internal Revenue Service has issued two new documents that affect charities that offer charitable remainder trusts and charitable lead trusts.

The first document offers guidelines for dividing a charitable remainder trust into two or more separate charitable remainder trusts without violating tax laws.

The second document contains sample forms for “inter vivos” nongrantor and grantor charitable lead unitrusts.

The full text of both documents are available through an IRS bulletin issued today.

The Internal Revenue Service is looking at whether charities are using offshore accounts and other tactics to avoid paying taxes on income earned in the United States.

Frank Ng, a top IRS official, told members of the Senate Finance Committee today that the agency is “evaluating the nature” of offshore investments by nonprofit groups that would otherwise be required to pay unrelated business income for their investment gains.

That acknowledgment, which came during a Finance Committee hearing on offshore investments, follows recent scrutiny of charities that are subject to unrelated business income tax.

The Chronicle found in a recent investigation that nearly half of the nation’s largest charities that receive unrelated business income pay nothing in tax on that income.

Sen. Charles Grassley, of Iowa, the senior Republican on the Finance Committee, has expressed concern that...

Presidential candidates John McCain and Barack Obama have been invited to weigh in on their plans for public service during a conference in New York City on September 11 and 12 organized by Time magazine and the Carnegie Corporation.

Both senators have strong backgrounds in public service and have said they would like to expand or improve current public-service programs such as AmeriCorps, as The Chronicle notes on the Campaign 2008 section of its Web site.

AARP, Target, and Service Nation — a national campaign of more than 100 organizations that want to promote expanded public-service opportunities— will also attend the forum. Senator McCain has confirmed his participation, according to the Carnegie Corporation, and Senator Obama is expected to attend.

The co-chairs of the conference will be Richard Stengel, managing editor at Time; Alma Powell; Caroline Kennedy; Carnegie’s...

A group of U.S. senators and House members from the Midwest have introduced a bill that would create tax incentives for charitable giving to help victims of the recent storms, tornadoes, and floods that have hit their region.

The Midwestern Disaster Tax Relief Act of 2008 would allow individuals and corporations to get unlimited charitable deductions for donations to relief efforts in the affected areas through the end of 2008.

The bill would also allow people who use their vehicles for disaster relief to deduct 41 cents per mile — or about 70 percent of the current business mileage rate through the end of 2009. The rates now are 14 cents per mile for charitable activities and 58.5 cents for business activities.

Volunteers could also exclude from their income reimbursements from charities for use of their vehicles up to the amount of the standard business rate through the end of...

The Senate Finance Committee on Thursday is playing host to a hearing that will focus on the controversial use of offshore banks in places like the Cayman Islands to shield earnings from federal taxes.

The committee has not yet announced its list of witnesses for the hearing.

But for many nonprofit institutions that manage overseas funds, the session bears watching.

Two key leaders of the powerful committee — Sen. Max Baucus and Sen. Charles Grassley — have made previous statements that condemn the use of overseas accounts to block the federal government from collecting taxes on income from hedge funds.

Mr. Baucus, a Democrat from Montana, chairs the committee. Mr. Grassley, of Iowa, is its senior Republican member.

Under current laws, institutions are able to use so-called blocker companies overseas to convert taxable profit from hedge funds into dividends, which are not...

Joe Novak sees a lot of abuse in the U.S. health-care system.

The former political and media consultant sees it in the profits earned by drug companies and the waste found in the insurance industry.

Mr. Novak also sees it in the financial practices of many nonprofit hospitals — an issue he believes does not get enough scrutiny.

With that in mind, the one-time aide to former Rep. William Lipinski of Chicago started a Washington nonprofit group called WhereTheMoneyGoes, which operates a Web site that uses public records to raise questions about the financial practices of nonprofit hospitals.

Recent posts on the site point to a building project at Sumner Regional Medical Center in Gallatin, Tenn., and the compensation packages paid to top executives at Bethesda Memorial Hospital in Boynton Beach, Fla., and Regional Health Care Services in Casa Grande, Ariz.

Mr. Novak is drumming ...

A California eye-insurance provider is petitioning the U.S. Supreme Court to reverse a 2003 decision by the Internal Revenue Service to revoke its tax-exempt status.

VSP Vision Care, in Rancho Cordova, Calif., said it believes the IRS overstepped its bounds when it ruled in 2003 that the organization does not provide enough services to the needy to justify its tax-exempt status.

The organization, which is the nation’s largest eye-insurance provider, has continued to do business as a nonprofit organization, but is paying federal income taxes as it has attempts to get the decision reversed.

The U.S. Court of Appeals upheld the IRS’ decision in January, prompting the insurance company’s petition to ask the Supreme Court to review the case.

Earlier decisions had determined that the organization “is not operated exclusively for the promotion of social welfare.”

But the insurance...

The Internal Revenue Service has made progress in improving the speed at which it processes applications by groups seeking tax-exempt status.

But Nina E. Olson, the national taxpayer advocate, says the agency still is not moving fast enough.

Ms. Olson, who operates independently of other IRS offices and reports to Congress, said in a new report that she plans to work with the IRS’s tax-exempt and government-entities division to change the way the agency processes applications for nonprofit status.

To qualify as a tax-exempt organization, groups must file Form 1023, which includes information about a group’s proposed activities and operations.

Because of the number of applications it receives, the IRS has been slow to keep up with processing the Form 1023 — leading to lengthy delays for groups that are awaiting a ruling on their nonprofit status.

Ms. Olson said in her report to...