Compliance
IRS Announces Guidance for “Siloing” Separate Unrelated Businesses
One of the more significant changes made by the Tax Cuts and Jobs Act of 2017 was to require tax-exempt organizations to separately calculate unrelated business income tax for each unrelated trade or business. Instead of offsetting all losses from all income attributable to all unrelated trade or business activities, organizations are now required to […]
Receipting Donations
Don’t be complacent. Each year tax-exempt organizations in the United States receive hundreds of millions of dollars in donations. Donors contributing to 501(c)(3) organizations are able to deduct their own contributions from their taxes, subject to IRS limitations. Recently, a higher standard deduction has been put in place through the Tax Cuts and Jobs Act. […]
Supreme Court Opens the Door for States to Collect Online Sales Tax
South Dakota v. Wayfair and Its Profound Effects The U.S. Supreme Court made sweeping changes to how sales tax laws can be enforced by overturning a 26-year-old precedent. In South Dakota v. Wayfair, the Court held that physical presence is no longer necessary for a state to enforce sales tax laws against out-of-state sellers. Countless online […]
Tax Cuts and Jobs Act: Changes That Affect Tax-Exempt Organizations
UPDATE: The Taxpayer Certainty and Disaster Tax Relief Act of 2019 amended the Tax Cuts and Jobs Act by repealing the tax on certain employee fringe benefits (parking) for nonprofit employers. An organization that paid the tax may be eligible for a refund. To claim a refund, the organization needs to file an amended 990-T, […]
Attention Non-Profits (and Social Enterprises): Are Your Charitable Registrations in Order?
The executive director of a national charity contacted our office with a question about charitable registrations. She served on the board of a non-profit corporation called “Socks for Everyone,”[1] and her board actively solicited charitable contributions in every state. She explained that Socks had filed for authorization to do business in every state, but had […]
IRS Decides Bitcoin is “Property.” What Does this Mean for Nonprofits?
Nonprofits should be aware of some recent developments in the IRS treatment of Bitcoin. The IRS recently decided Bitcoin would be treated as property under US tax law. What does that mean for nonprofits who want to receive contributions of Bitcoin? And what does it mean for donors wishing to make contributions in Bitcoin?
IRS Highlights Concerns with Tax on Unrelated Business Income and Compensation
The IRS concluded a multi-year study of colleges and universities last year, issuing a report that is now being carefully reviewed by advisors to the nonprofit sector[1]. The IRS is using the study to send a message to the entire exempt sector, so the information we can glean from it must be considered a strong […]
Nonprofit Mail Eligibility
If your organization is exempt under Section 501(c)(3) of the Internal Revenue Code, it probably qualifies to use the nonprofit mailing rate offered by the U.S. Postal Service.
Tax-exempt Organizations Must be Aware of Complicated Tax Issues
For organizations that theoretically pay no tax, tax-exempt organizations have remarkably complicated tax issues. The term “tax-exempt organization” simply means that the organization is exempt from federal income taxes. Tax-exempt organizations remain subject to state and federal tax issues that can involve great complexity. To maintain tax-exempt status, many organizations must file an annual information […]
Review Endowment Fund Policies for Legal Compliance
Organizations with endowment funds commonly set forth standards for managing, investing, and appropriating these funds in their bylaws or other policies. Unless an organization actively monitors developments in this area of the law, it is possible that its policies or bylaws do not accurately reflect current legal standards. In Illinois, the Uniform Prudent Management of […]