Author Archives: Grant Williams
October 14, 2010, 12:58 pm
Under federal law, tens of thousands of small charities will automatically lose their tax-exempt status if they fail to meet a Friday deadline to file required forms with the Internal Revenue Service.
“The October 15 deadline is the last chance for many small charities to comply with the law,” said Douglas H. Shulman, the Commissioner of Internal Revenue.
After the IRS announces early next year which small groups have lost their tax exemptions, organizations will have to reapply to the IRS for new exemptions by filing some complicated paperwork, pay a fee of up to $850, and wait as their paperwork is processed.
Groups will be liable for income taxes on money they receive from donors during the time that they are without their tax-exempt status. And donors won’t be able to take charitable-contribution deductions for their gifts until the tax exemptions are restored.
October 8, 2010, 4:10 pm
The Internal Revenue Service has released a draft copy of its 2010 Form 990 informational tax return, the primary document that charities file each year. The draft copy is of the main form filed by all organizations, not the accompanying schedules. The IRS said that it may make further changes to the form before it is officially released.
October 5, 2010, 12:45 pm
Silver Spring, Md.
Charity governance practices were among the key topics discussed by charity regulators and lawyers for nonprofit groups at a meeting Monday of the National Association of State Charity Officials.
Lois G. Lerner, director of the Internal Revenue Service’s Exempt Organizations division, noted that the tax agency has received criticism in recent years for its interest in the governance practices of charities.
The federal tax code does not explicitly set out governance standards for the IRS to enforce, but the tax agency is keeping an eye on charities’ practices.
Some nonprofits and legal experts have said the IRS has overstepped its legal authority, but Ms. Lerner said the controversy has faded.
“When we first raised the word ‘governance,’ they came after us with apples, tomatoes, and big frying pans to hit us over the head: You’re the IRS, you have no business in…
October 1, 2010, 11:17 am
The need to protect charities and donors during difficult economic times is a key theme of the annual one-day public meeting of the National Association of State Charity Officials, which will be held in Silver Spring, Md., on Monday.
Eric Carriker, president of the regulators association and an assistant attorney general of Massachusetts, noted that regulators always strive to prevent fraud and the misapplication of charitable assets.
But during tough economic times, Mr. Carriker says, “there are limited resources available to our nation’s nonprofits, and it is important that all of us connected with the nonprofit sector work hard to ensure that assets intended to provide vital services to our communities are effectively used to support those causes.”
Conference topics include “Creation and Regulation of New Fund-Raising Strategies in a Down Economy: Cause Marketing, Internet Fund…
September 28, 2010, 9:31 am
The Internal Revenue Service has released an online widget that charities, donors, and volunteers can place on their Web or social-networking sites “to help spread the word about the one-time filing relief for small organizations at risk of losing their tax-exempt status.”
The IRS announced in July that small groups in danger of losing their exemptions because they have failed to file required informational tax returns (called Forms 990-N or e-Postcards) can preserve their charitable status by filing returns by October 15, 2010.
The new widget directs charities to click on the IRS Web site to obtain key information.
“When local charities lose, everybody loses: Protect your favorite charity’s tax-exempt status,” the widget says in part. “Many do not know of this law, or that they are at risk.”
Instructions are provided on how to post the widgets. An example can be found below:
September 24, 2010, 10:52 am
The U.S. Senate has again decided not to consider a controversial bill intended to lift the veil on who is paying for advertisements and other communications that advocacy groups and businesses sponsor to influence elections.
Many advocacy groups had objected to a donor-disclosure provision in the bill.
It was the second time the Senate decided not to take up the bill; the first was in July. The House of Representatives passed the measure in June in response to a Supreme Court ruling.
The bill, known as the Disclose Act, would require corporations that issue political communications, including many advocacy groups organized under Section 501(c)(4) of the Internal Revenue Code, to reveal information about their donors.
The Senate could again reconsider its position on whether to debate and vote on the measure.
September 8, 2010, 10:00 am
The Internal Revenue Service has released a draft version of the form that charities and other tax-exempt organizations will use to calculate a new tax benefit they will get under the federal health-care overhaul law.
As the IRS noted in an announcement, the new law offers a tax credit designed to encourage small employers to offer health insurance coverage or maintain the coverage they currently offer their workers.
The credit, which went into effect this year, was included in the federal health-care law enacted in March. The provision applies to employers with no more than 25 full-time employees and average wages below $50,000. Nonprofit organizations can apply the credit to certain payroll taxes.
The Internal Revenue Service said nonprofits eligible for the credit should claim it on a revised version of the Form 990-T, the IRS document that groups use to report business income not…
August 27, 2010, 12:52 pm
The Internal Revenue Service today reminded thousands of small charities that they can keep their tax-exempt status even if they missed their May deadlines to file a new online form.
“If you are a volunteer, member, or just a friend of an organization at risk of losing its exemption, please alert the organization and encourage it to go to IRS.gov and find out how the organization can come back into compliance today,” the IRS said.
The IRS also released additional advice for some organizations, including those that believe they are exempt from filing because they are religious organizations.
As the tax agency announced last month, small groups at risk of losing their exemptions because they failed to file required informational tax returns for 2007, 2008, and 2009 on May 17 or later can preserve their status by filing returns by October 15, 2010, under a “one-time relief program.”
August 26, 2010, 12:06 pm
An updated guide to laws on the election-related activities of nonprofit organizations classified under Section 501(c)(3) of the federal tax code has been released by the Alliance for Justice, a national association of advocacy groups.
The 74-page publication, called The Rules of the Game, “reviews federal tax and election laws which govern nonprofit organizations in an election year, and explains the right (and wrong) ways to organize specific voter-education activities,” according to the Alliance for Justice.
The guide answers questions such as: “Are nonprofit organizations completely prohibited from any involvement in candidate campaigns? Is there a minimal amount of electoral activity that 501(c)(3) organizations can do without risking their tax-exempt status? How can 501(c)(3) organizations educate voters about candidates and issues? Does federal election law apply to 501(c)(3)…
August 18, 2010, 12:25 pm
A new online database — called GuideStar Israel — has been started in Jerusalem with the goal of making the 29,000 nonprofit organizations in Israel “more transparent” to the public through financial and other information.
A free Web site, which is in Hebrew, Arabic, and English, lists and provides official information about each nonprofit registered with the Israeli government’s Registrar of Non-Profit Organizations. The site also allows groups, some of them so small they do not have a Web presence, to give additional “in-depth information” about themselves.
GuideStar Israel is a joint project of the government’s Ministry of Justice, Yad Hanadiv (which acts in Israel on behalf of the Rothschild family philanthropic trusts), and JDC-Israel. It is operated by NPTech, a nonprofit “public benefit” group established by Yad Hanadiv and JDC-Israel that helps organizations use information…