I tweeted day one of the 2009 Georgetown Representing & Managing Tax-Exempt Organizations Conference today. The absence of wireless access in the Hyatt conference rooms prevented live tweeting, but I posted the following tweets during breaks and in the evening:

• IRS Director, Exempt Organizations, Lois Lerner, noted an increase in EO applications this year – in part due to perceived need
• Lerner: The most important asset of the nonprofit sector is public trust; invest in enhancing trust of governance (make policies public)
• Lerner: note 5th Cir case in which a Chairman was held personally liable for a nonprofit's unpaid payroll taxes
• Lerner: the requirement that the 990-T be made public will result in greater scrutiny on a nonprofit's unrelated business activities
• Lerner: IRS delay in processing exemption applications (for past several months) resulted from crash of automated system-to be resolved soon
• Lerner: the measure of success of a leader is not in good times, but in bad times – optimistic that the sector will be stronger

• Treasury and IRS counsel Emily Lam, Judith Kindell, and Catherine Livingston provide update from Treasury and IRS at Georgetown EO Conf.
• New bills include Cardin bill (newspapers); Schumer bill (investment income tax); mileage rate bills; IRA rollover bills; Charities Enhancement Act
• Guidance priorities include proposed regs on new requirements for supporting orgs as added by Pension Protection Act (by June 09)
• Important court decisions: employment tax; intern-medical student case; Living Word Christian Center 

• Theresa Pattara, tax counsel for Sen Grassley, said Sen thinking about legislative reform that distinguishes very large orgs from small org  
• Pattara: there are too many unsustainable nonprofits being formed during these times for the wrong reasons (eg to provide work for founders)
• Pattara: Grassley interested in 990-PF reform – how to leverage new 990 materials because of substantial costs involved
• Pattara: not enough disclosure of where grants are going (note movements by Greenlining Institute and in FL)
• Pattara: reform of unrelated business income tax rules is well overdue – most filers of 990-T do not pay any UBIT

• Stephanie Strom (NYT) and Mike Spector (WSJ), reporters who cover nonprofits/philanthropy, speak at Georgetown EO Conference.
• Strom: Nonprofits are not as press-savvy. Reporters asking for information typically need it in under 24 hours.
• Spector: If you can't help the reporter, let them know up-front. Responsiveness is critical to developing a good relationship with the press
• Spector: expect feature stories on the fallout from the Madoff scandal. Strom: don't expect much from Washington this year.
• Strom: expect stories on public charities and accumulated assets, executive comp, role of the sector in society, how assets are stewarded
• Betsy Adler asks reporters for guidance about on the record, off the record, background.
• Strom: off the record means she can't use it unless she gets it from someone else; background means attribution only by role not name
• Strom to professionals: If the interview doesn't involve your client, she appreciates if you stay on the record (with attribution).
• Spector: For reporters, transparency means access. If nonprofits think an issue is important, be prepared to go on the record.
• Strom & Spector: some media training is good, some very bad. Don't spout gobblygook (spin without substance).
• Spector: reporters are truth-seekers who prefer candor above all else. 

• Nonprofit lawyer Bruce Hopkins speaks on current developments at Georgetown Exempt Organizations Conference.
• Hopkins: IRS Charitable Spending Initiative – commensurate test – not much activity yet but forthcoming.
• Hopkins: The IRS Colleges & Universities Questionnaire signals the IRS direction on compensation, endowment admin, unrelated business rules.
• Hopkins: Form 990's 3 purposes: 1) collect information; 2) influence behavior (eg. develop policies); 3) create law!
• Hopkins: IRS appears to be viewing emergency assistance organizations a little more favorably than in the past.
• Hopkins: Newspaper Revitalization Act probably has not much chance to pass
• Hopkins: REOs exempt under 501(c)(3) for lessening burdens of gov't, not promotion of health. Leg history – private benefit is incidental.
• Hopkins: IRS Hospital Study – amounts of compensation appear high but supported under current law – suggests law may be changing
• Hopkins: Bad PLR – board of 3 unrelated persons causes org not to qualify for exemption b/c board has "unfettered control" over org's asset
• Hopkins: IRS memo to its agents about import of web links in context of prohibition on electioneering by public charities
• Hopkins: public charity intervened in political campaigns when it absorbed website of its controlled social welfare org
• Hopkins: 2008 DLC case – once exempt status is recognized, IRS can't retroactively revoke exemption where no material change in facts 

• IRS reps provide information on audits at Georgetown Exempt Organizations Conference.
• Current IRS compliance initiatives: charitable spending, gifts in-kind, governance, mutual orgs, student loan orgs.
• Ongoing IRS compliance initiatives: colleges & universities, political activities compliance, hospitals, community foundations, non-filers.
• Other IRS ongoing projects: consumer credit counseling, supporting orgs, conservation easements, publicly supported charities, c7 reqs …
• IRS EO Examination: after first meeting, additional info may be needed – agent should explain what is needed and why it's needed.
• IRS EO Exam: If the audited org has concerns with the agent, it has the right to contact the agent's group manager. 
• IRS EO Exam: Audited org should reach agreement with agent about reasonable due dates for additional information requested by the agent.
• IRS EO Exam: If audited org disagrees with the outcome of the audit, it may (1) appeal; or (2) opt for fast track settlement (NEW).
• Sarah Hall Ingram, Chief, Appeals at IRS: Appeals charged with giving an independent, impartial, fresh look at case.
• Ingram: IRS Appeals reports straight to Commissioner, not to EO. Appeals will not consider new evidence without EO's review (not its role).
• IRS Appeals: See Rev Proc 2000-43 for ex parte rules (Appeals generally not talking to IRS-EO without participation of org or org's rep).
• Fast Track Settlements: Resolve disputes with IRS within 60 days. Announcement 2008-105. If unhappy with resolution, can still appeal..

• Nonprofit lawyers Michael Sanders and TJ Sullivan discuss nonprofit joint ventures at Georgetown Exempt Organizations Conference. 
• Sullivan: 2005 Senate Finance Committee hearing – don't sacrifice charitable purposes of JV for the sake of maximizing profits 
• Sullivan: nonprofit hospitals engage in JVs that shift most profitable/valuable assets to JV so greater profits/value may be shared w/ docs.
• Sullivan discusses history of nonprofit JVs. Pre-1980 – per se inconsistent with exemption; Plumstead; Redlands; 98-15, St. David's, 2004-51
• JV Test: 1) Participation in JV furthers EO's exempt purpose; 2) Venture permits EO to act exclusively in furtherance of its exempt purpose.
• JV Control Test: EO must control venture to further exempt purpose. Majority voting control best. Less than majority w/ protections?
• Sanders: Key Qs: 1) what is JV; 2) what portion of JV activities/financials must org report; 3) how does org report info if tax years differ
• Sanders: Control means more than 50% ownership or being managing or general partner if <3 managing or general partners, respectively.
• Sanders: 990 asks if you have a JV Policy – better say yes if you've entered into one or more JVs.
• JV Policy: mission, scope of relationships, types of arrangements=JV, standards, rules of compliance, prohibited activities, reporting.
• Sanders: New Market Tax Credit Program overview. 59% tax credit on capital invested in CDE over 7 years.

• Nonprofit lawyer Eve Borenstein, CPA D. Greg Foller, and IRS senior tech advisor Ronald Schultz discuss 2008 Form 990 at Georgetown EO Conf.

The link to my day two tweets is here.