Lorman Seminar on “Tax-Exempt Organizations” – October 18, 2005

Yesterday, I attended an excellent full-day seminar entitled "Tax-Exempt Organizations" presented by several attorneys from San Francisco-based Silk, Adler & Colvin, one of the nation’s largest and most well-regarded firms practicing exclusively in this area of the law.  The outline of the seminar is as follows:

I.  Overview

II.  Governance Issues – Nonprofit Integrity Act
    A.  Mandatory financial audits – audit threshold, audit committee and public disclosure
    B.  Salary review of top officials – Who?  Why?  When?  What?
    C.  Fundraisers – Commercial fundraisers, fundraising counsel and the charity
    D.  Impact of the NIA on non-California charities – audits, salary review and fundraising regulation

         * Highlights:  Emphasis on the application of the periodic salary review requirement (with respect to the President or CEO and the Treasurer or CFO) to all charitable organizations doing business in California (subject to minimum contacts threshold). 

III.  Congressional Proposals

         * Highlights:  Prediction that Senators Grassley and Baucus will introduce charitable reform legislation in December 2005 or January 2006.

IV.  International Philanthropy Update
    A.  Foreign grantmaking recent developments
    B.  Patriot Act and other anti-terrorist funding experiments
    C.  Certification and other due diligence issues
    D.  Use of intermediaries

         * Highlights:  Discussion of Principles of International Charity developed by the Treasury Guidelines Working Group of Charitable Sector Organizations and Advisors.

V.  Unrelated Business Income
    A.  When is earned income taxable?
    B.  Key exceptions to unrelated business income
    C.  Focus on corporate sponsorship arrangements
    D.  How much unrelated business income is too much?

         * Highlights:  Coverage of options for structuring a charity’s unrelated business activities.

VI.  Development
    A.  Planned giving
         1.  Law update
              a.  CRT drafting
              b.  CRT administration
              c.  Gift annuity administration
              d.  Pre-arranged sales
              e.  Substantiation
         2.  Gift planning update
              a.  Short-term CRT
              b.  Charity-tenant CRT
              c.  Life estate – remainder gift
              d.  Bequest of an IRA

         * Highlights:  Discussion of problems associated with Rev. Proc. 2005-24 (also see ACGA letter to IRS re: Rev. Proc. 2005-24).

VII.  Commercial Fundraising
    A.  Overview of charitable solicitation regulation
    B.  Commercial fundraisers and fundraising counsel
    C.  Third-party fundraising agreements
    D.  Fundraising over the internet

         * Highlights:  Discussion of The Charleston Principles:  Guidelines on Charitable Solicitations Using the Internet approved by the National Association of State Charity Officials (NASCO) as advisory guidelines (2001).

VIII.  Hot Topics – Fiscal Sponsorship
    A.  The alternative to forming a new 501(c)(3) organization:  Connect with an existing charity
    B.  Avoiding conduit, pass-through and sham
    C.  Which model is right for your project?
    D.  Best (and worst) practices
    E.  How to find a good fiscal sponsor

         * Highlights:  News of the upcoming publication of a revised edition of Greg Colvin’s book "Fiscal Sponsorship:  6 Ways To Do It Right,"  a must have for anybody thinking of entering into a fiscal sponsorship arrangement.

Some of these issues have been discussed in previous posts.  Look for more coverage in future entries.