Nonprofits

Tax-Exempt Nonprofits

The firm represents and advises all sizes and types of nonprofit tax-exempt organizations, including charities, publishers, churches, religious organizations, international ministries, private schools, charter schools, medical organizations, scientific research organizations, environmental groups, trade associations, private foundations, social clubs, 501(d) apostolic associations, and even a cemetery.

Start Ups

The firm handles numerous new nonprofit startups every year. We work with individuals and groups or associations seeking the best ways to organize to conduct their charitable activities. This includes advice about the purpose of the organization and structuring the organization’s activities to comply with exemption requirements. We help organizations determine an appropriate corporate structure for their needs and prepare bylaws to guide them in governing the organization and complying with state and federal law. We advise clients on matters of corporate governance, the liability of directors, fiduciary duties, and necessary board policies.  We are equipped to counsel high net-worth individuals in determining if their charitable aims are best conducted through a private foundation, donor-advised fund, or other giving strategy. 

Federal, State, and Local Tax Exemption

The firm’s tax practice includes helping nonprofits obtain federal income tax exemptions under Internal Revenue Code Sections 501(c)(3), 501(c)(4), 501(c)(6), and other 501(c) sections.  We draft, prepare, and file IRS exemption applications to seek the appropriate public charity status for the organization.  We are well-versed in the regulations that apply to public charities and private foundations alike.  If exempt status is revoked for failure to file annual series 990 information returns, we counsel organizations on steps needed to reinstate exempt status and we prepare the reinstatement application.  We assist and advise organizations with IRS compliance, including analysis of statutory law, Treasury Regulations, and IRS guidance to structure new activities or to correct problems discovered with existing activities.  If an organization finds itself under IRS examination or audit, we guide organizations through that process and interact with the IRS on their behalf.  In the area of state and local tax exemptions, the firm has extensive experience with sales tax exemptions in multiple states and real estate property tax exemptions for charitable, educational, and religious organizations.

State Charitable and Regulation Compliance

We provide counsel regarding compliance with a myriad of applicable state regulations. Organizations that operate in multiple states may be subject to regulation by those states, and we guide our clients with multistate operations through this regulatory framework.  We advise organizations on charitable solicitation laws in the states where they raise funds and assist them with registering and renewing their registrations.  A remote workforce presents a variety of compliance matters.  We regularly assist organizations in complying with employment laws in states where their employees reside and craft organization-wide policies that encompass the requirements of other states. 

Mergers and Collaborations

We assist organizations in negotiating and facilitating mergers, asset transfers, and other mechanisms to combine activities or to move them to another organization.  We also help organizations collaborate with each other on joint ventures, grant-making activities, and other cooperative ventures.  

Contract Writing and Review

We draft a wide variety of contracts and agreements specific to tax-exempt organizations, including accountability agreements, grant agreements, and joint venture agreements.  We also draft and counsel clients on contracts that apply to general operations, such as intellectual property licenses, agreements with vendors, employee agreements and offer letters, and commercial real estate purchases and sales.  If clients find themselves in a difficult position with an existing contract, we are equipped to review the contract, determine applicable remedies, and find the best way to resolve the dispute.

International Grant Making and International Branch Formation and Closure

The firm has worked extensively with foreign counsel in establishing (and closing) branch organizations in dozens of foreign countries.  For organizations considering expansion to a foreign country, we collaborate with foreign counsel to determine the best strategy to accomplish the organization’s goals within the local framework.  We have worked with foreign legal counsel in complying with applicable foreign laws governing employment and owning property and maintaining funds within the country.  In addition to foreign law, U.S. organizations that conduct foreign activities or that work with individuals or groups in foreign countries are subject to U.S. laws that ban funding terrorism and other illicit activity.  We assist our clients in complying with the U.S. Treasury regulations and other laws that regulate how funds are used, maintained, and disbursed in foreign countries. 

Churches and Religious Organizations

In addition to advising churches and other religious organizations on matters generally applicable to all tax-exempt organizations, we handle legal matters specific to them. For example, we assist churches incorporated under the Illinois Religious Corporations Act in making what is known as an “NFP election,” which is a filing a church can make to be governed under the Illinois Not For Profit Corporation Act.  We are experienced in the formation of church associations and church mergers. We counsel churches on bylaws, constitutional changes, and governance.  In the area of child protection and risk management, we review existing child protection policies and guide churches in improving them or correcting misstatements of the law.  We are able to prepare child protection policies for churches that need them and counsel them on training their staff and volunteers to implement them.  We also counsel churches on general risk management strategies and policies, including appropriate use of church facilities, foreign travel, outreach activities, and member disciplinary matters. 

We assist churches in complying with tax requirements uniquely applied to churches, such as the ministers’ housing allowance, opting out of social security, and certain tax exemptions.  We help churches seeking to expand their ministries by starting schools, opening resale stores, and founding social service organizations.  We have experience facilitating housing arrangements for church ministers, including parsonages and other church-financed assistance.  If a religious worker visa is needed for a pastor or missionary, we can work with immigration counsel to guide the church through the process to obtain the visa.  We handle church and religious organization real estate sales, purchases, and leases.

Dissolution

When organizations are at the end of their life cycle, we help them navigate the dissolution process, including distributing assets in accordance with IRS requirements and charitable trust doctrines and making provision for future liabilities from past operations.  We assist clients in making the appropriate filings to dissolve the entity and notify government agencies of the dissolution.