Nonprofit Law Podcast #43: The Best IRS Publication Revamped

The Best IRS Publication Revamped

Download: Nonprofit Law Podcast #43 (mp3, 9:11)

Shownotes

Intro

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

Resources

• IRS Publication 1828 (PDF)

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

Nonprofit Law Podcast #42: Double Duty

Double Duty

Download: Nonprofit Law Podcast #42 (mp3, 9:50)

Shownotes

Intro

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).

Resources

BoardSource
How many nonprofits compensate their board members?
Is it acceptable for a board member to have a personal relationship with a staff member?
Can conflict of interest be an obstacle to board service?
How does a nonprofit safeguard against organizational conflict of interest?

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

Nonprofit Law Podcast #42: Double Duty

Double Duty

Download: Nonprofit Law Podcast #42 (mp3, 9:53)

Shownotes

Intro

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).

Resources

BoardSource
How many nonprofits compensate their board members?
Is it acceptable for a board member to have a personal relationship with a staff member?
Can conflict of interest be an obstacle to board service?
How does a nonprofit safeguard against organizational conflict of interest?

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

Nonprofit Law Podcast #41: Responsibilities of Foundation Board Chairs

Responsibilities of Foundation Board Chairs

Download: Nonprofit Law Podcast #41 (mp3, 8:31)

Shownotes

Intro

Tim Mooney… Welcome to the Nonprofit Law Podcast
Your guide to the laws impacting nonprofits.
Shownotes…. nplawcast.com
Email the show

Important responsibilities for board chairs (and other board members)

• 1. Be Faithful to Mission
• 2. Guide the Grantmaking Strategy
• 3. Map Out the Future
• 4. Stay Focused on Financial Oversight and Legal Compliance
• 5. Master the Art of Facilitating Meetings
• 6. Connect the Dots Between Committees
• 7. Build a Board That Is Strong And Engaged
• 8. Communicate with the Community
• 9. Oversee Administrative Work
• 10. Assess Performance

Resources

BoardSource, Ten Essential Responsibilities of Foundation Board Chairs
Full whitepaper

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

Nonprofit Law Podcast #40: Due Diligence

Due Diligence

Download: Nonprofit Law Podcast #40 (mp3, 12:05)

Shownotes

Intro

Tim Mooney… Welcome to the Nonprofit Law Podcast
Your guide to the laws impacting nonprofits.
Shownotes…. nplawcast.com
Email the show

Due Diligence for Nonprofits

• Conflict of interest policy for board members, officers, and senior staff
• Whistleblower policy
• Document retention and destruction policy
• Gift acceptance policy
• Compensation policy
• Parent-subordinate consistency policy
• Contemporaneous documentation of meeting minutes of board and committees
• Compensation and Audit committees
• For grantmakers - Maintains records to substantiate the amount of the grants or assistance, the grantees’ eligibility
• for the grants or assistance, and the selection criteria used to award the grants or assistance.

Resources

American Council on Education - 501(c)(3) Due Diligence (PDF)

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

Nonprofit Law Podcast #39: Not Charitable Enough?

Not Charitable Enough?

Download: Nonprofit Law Podcast #39 (mp3, 7:06)

Shownotes

Intro

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

Resources

IRS Denies Tax-Exempt Status to Group That Spends Too Little Money on Charitable Programs, Chronicle of Philanthropy

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

Nonprofit Law Podcast #38: An Apollo Project for Nonprofits

An Apollo Project for Nonprofits

Download: Nonprofit Law Podcast #38 (mp3, 6:54)

Shownotes

Intro

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