By NEO Law Group
While charitable organizations are permitted to arrange executive compensation agreements, "unreasonable" compensation to a disqualified person will be considered an excess benefit, subjecting the disqualified person and members of management who approved the transaction to penalties under section 4958 of the Internal Revenue Code known as "intermediate sanctions." The IRS uses the term "disqualified person" […]
On October 3, 2008, the IRS released Notice 2008-90, announcing that the IRS and the Treasury Department are studying the computation of the deductible amount and adjustment to cost of goods sold for charitable contributions of inventory property that constitute qualified contributions as defined in ยง 170(e)(3)(A) of the Internal Revenue Code. The Notice provides: […]
The Council on Foundations Annual Conference included a session entitled The Latest from Washington: Legislative and Regulatory Update, featuring Steve Gunderson, President and CEO, Council on Foundations; and Diana Aviv, President and CEO, Independent Sector. Here are just a few of the illuminating observations made: Senator Max Baucus, Chairman of the Senate Finance Committee, and […]
Council on Foundations Vice President and General Counsel Janne Gallagher provided an update on supporting organizations after the Pension Protection Act of 2006 (the "PPA"). As a result of the PPA, private foundations and sponsoring organizations of donor-advised funds must determine: (1) whether a charity to which they are making a grant is a "supporting […]
The Advanced Legal Seminar given at the Council on Foundations Conference featured Lisa Johnsen of Kirkpatrick & Lockhart Preston Gates Ellis; Marcus Owens of Caplin & Drysdale and former head of the Exempt Organizations division of the IRS; LaVerne Woods of Davis Wright & Tremaine and Chair of the American Bar Association Section of Taxation […]
The following list of accomplishments of the Exempt Organizations division of the IRS (EO) in 2006 is excerpted (and slightly modified) from the IRS Letter to colleagues, members of the press and taxpayers dated as of November 7, 2006: Political Campaign Activity. EO responded to increased complaints about political intervention by 501(c)(3) organizations and dramatic […]
The term "donor-advised fund" is not statutorily defined; yet the donor-advised fund (DAF) is an increasingly popular vehicle of charitable giving that has had a particularly substantial impact on philanthropy over the past several years. The Chronicle of Philanthropy reported that the 88 organizations that provided figures for both 2003 and 2004 to The Chronicle […]
On October 26, 2005, I "attended" a teleconference entitled "Dealing With the New IRS Form 1023" sponsored by the Taxation Section of the American Bar Association and The ABA Center for Continuing Legal Education. The presenters, including Eve R. Borenstein and Kristin M. Gurdin, provided tips and identified traps with respect to the preparation of […]
Gifts A gift is a transfer that (1) is voluntary, and (2) is motivated by a "detached and disinterested generosity." Commissioner v. Duberstein, 363 U.S. 278, 285 (1960). "Where consideration in the form of substantial privileges or benefits is received in connection with payments by patrons of fund-raising activities, there is a presumption that the […]
Session 1 Tax-Exempt StatusJeopardizing 501(c)(3) Status Distinction between "tax-exempt" and "nonprofit" Major types of exempt organizations – charitable/educational/religious; public charity/private foundation; (c)(3) / (c)(4) / … Benefits of tax-exempt status – income tax exemption; possible exemption from state income, sales and property taxes; reduced postal rates offered to some Actions that jeopardize tax-exempt status – […]