Fiscal sponsorship is when a nonprofit organization accepts tax-deductible donations on behalf of another organization that does not have 501(c)(3) status. Solicitations are made in the name of the fiscal sponsor and therefore permit the sponsored project to rely on the sponsor’s IRS determination letter, solicitation registrations, etc.
On January 31, 2020, the IRS announced that it has released a new online version of Form 1023. The revised Form 1023, Application for Recognition of Exemption Under Section 501(c)(3) of the Internal Revenue Code is reformatted for electronic filing.
On January 21, 2020, the IRS issued guidance detailing how nonprofits can apply for refunds of the repealed “parking tax.” Recall that in December 2017, the Tax Cuts and Jobs Act imposed an unpopular and widely criticized 21% tax on employee transportation benefit expenses incurred by nonprofits. The transportation tax, or “parking tax” as it came to be known, was retroactively repealed in December of 2019. The retroactive nature of the repeal creates an opportunity for nonprofits that paid the tax to seek refunds.
At the close of 2019, Congress passed legislation that has a significant impact on nonprofits. On December 20, 2019, the Further Consolidated Appropriations Act, 2020, also known as H.R. 1865, became law. This act includes two provisions that significantly impact nonprofits:
The simplification of the excise tax on net investment income; and
The retroactive repeal of the unrelated business income tax on qualified transportation fringe benefits.
Arizona has a robust system of state charitable tax credits that permit taxpayers to direct their state tax dollars to the community organizations that they
Your Privacy and Legal Notice Webpage cannot be a last-minute matter anymore but must be a prominent feature on your entire website and be composed of words that the average user can comprehend without the need for a lawyer.
Many non-profit’s use the 51% benchmark for a quorum as a concession that directors will not be able to attend all meetings, but having a majority of board members in attendance for official business ensures a representative cross-section of participation which will not simply reflect the will of a very small clique of directors. However, organizations that value strong hands-on participation by board members may set a higher quorum requirement to encourage meeting attendance and broader participation.
A “UBIT blocker” is a for-profit corporation that is wholly owned by a tax-exempt organization, but whose activities are not attributable to its tax-exempt parent.
The need for committees and which types will vary based on your organization’s age, size, and activities. Newer organizations may be able to get by with a small working board and few or no committees, while large and established nonprofits would be hamstrung without the robust use of committees.
Technology now offers businesses and boards many advantages, including the ability to meet via teleconference, video conference, or even conduct discussion and voting via electronic communications, such as email. But while email is commonplace among many organizations for its ease of use, especially for busy and geographically diverse volunteers sitting on nonprofit boards, there are several reasons to think twice before using email for your next important nonprofit board vote.
Most states require you to register your organization if you solicit donations from their residents. Many states also require registration if your organization collects substantial or ongoing donations from their residents, even if you aren’t specifically targeting donors in that state. Download our comprehensive list of each state’s requirements.
Download our free guide to learn about the many elements needed to run a successful nonprofit organization, as well as how to avoid common pitfalls and mistakes.