Sep 072012
 
Church May Have Violated IRC By Endorsing Romney For President

St. Raphael Catholic Church of El Paso Texas appears to have violated the IRC by endorsing Mitt Romney in its bulletin.  “I am asking all of you to go to the polls and be united in replacing our present president with a president that will respect the Catholic Church in this country,” the entry in the church’s August 5 bulletin says. “Please pass this on to all of your Catholic friends.” 501(c)(3) organizations are strictly prohibited for engaging in political activity under several provisions of the IRC.  The rules that apply with respect to lobbying activities are set forth in More…

Aug 212012
 
Tax Tips For Charitable Giving

Contributing money and property to a charitable organization is one of the ways that a taxpayer can support a charitable cause while simultaneously reducing their income tax burden.  However, in order for the donation to be tax-deductible, certain conditions must be met.  The IRS recently put forward the following tips for taxpayers regarding the deductibility of donations. 1. Tax-exempt status – Contributions must be made to qualified charitable organizations in order to be deductible.  Be sure to ask the charity about its tax-exempt status, or check IRS.gov for the Exempt Organizations Select Check (a/k/a Publication 78), an online search tool More…

Aug 062012
 
IRS Rules That Donations To Single Member LLCs Wholly-Owned By Charities Are Deductible

The IRS has issued a new notice which offers guidance regarding the deductibility of contributions made to a single member LLC that is wholly-owned by a charitable organization.  Notice 2012-52 states that the IRS will now treat contributions to a single member LLC that is disregarded for income tax purposes as contributions to a branch or division of the charitable organization.  Thus, if contributions to the charitable organization itself are deductible on the donor’s federal income taxes, contributions to a single member LLC owned by the charitable organization will also be deductible. A disregarded entity is considered the same as More…

Jun 182012
 
GOP Lawmakers Send Letter To IRS Demanding Justification For Donor Name Requests

It seems as if the ongoing saga between the IRS and political action committees (PACs) took another turn today as eleven Republican senators who serve on the U.S. Senate Committee on Finance sent a letter to the IRS citing concerns over privacy protections and requesting additional information regarding the agency’s request for private donor information from organizations seeking tax exempt status.  Previously, we discussed calls by campaign finance reform advocates to investigate the role that 501(c)(4) tax-exempt organization were playing in influencing elections and the IRS’ denial of tax-exempt status to one organization which the IRS determined to be organized More…

Jun 082012
 
IRS Denial Of Tax Exempt Status To Political Group May Be Cause For Other Groups' Concern

A recent decision by the IRS to revoke the tax-exempt status of Emerge America, a small political nonprofit organization, may concern larger groups, such as Crossroads GPS and Priorities USA, that have already spent millions on the 2012 U.S. presidential election and are looking to spend millions more.  The IRS decision, released last month, involved a so-called campaign school in which a partisan group provided “training” to candidates.  “You are not operated primarily to promote social welfare because your activities are conducted primarily for the benefit of a political party and a private group of individuals, rather than the community as More…

Nov 182011
 
IRS Scrutinizes Universities For Unrelated Business Taxable Income

The IRS has recently begun scrutinizing several universities, including Notre Dame, Purdue, the University of Texas at Austin, Texas A&M, the University of North Carolina, the University of Georgia, Lamar University, the University of Central Florida, Yeshiva University, Suffolk University, and Harvard, for failing to accurately report unrelated business taxable income. Generally, not-for-profit universities are exempt from paying taxes on tuition or other money that relates directly to their educational mission.  However, the government still requires that all tax exempt entities pay income taxes on a class of revenue known as “unrelated business taxable income (UBTI).”  UBTI is income from More…

Nov 162011
 
Tax Tips For Charitable Giving

The holiday season is upon us, and for many people that means charitable giving.  As a reward for their kind gesture, the philanthropically inclined can look forward to a tax deduction next year when its time to file those returns.  Here are some points to ponder when deciding on making those charitable donations ahead of the 2012 tax season. •    A deduction is only available for donations made to a qualified organization.  Qualified organizations include nonprofit groups that are religious, charitable, educational, scientific, or literary in purpose, or that work to prevent cruelty to children or animals.  Nonqualified organization include More…

Sep 292011
 
IRS Called Upon To Investigate Political Groups

Two campaign finance reform advocates have asked the IRS to investigate the special tax status claimed by four tax-exempt organizations that are expected to play a major role in influencing the 2012 elections.  The two watchdog groups: Democracy 21 and the Campaign Legal Center, are arguing that the four political groups: Crossroads Grassroots Policy Strategies, American Action Network, Priorities USA, and Americans Elect, should be required to register as political organizations, lose their tax-exempt status, and publicly disclose their donors.  Currently, all four organizations are established as 501(c)(4) entities. The laws surrounding 501(c)(4)s are convoluted.  According to the Treasury Regulations, More…

Sep 132011
 
The Difference Between Nonprofit And Tax-Exempt Status

Many times we come across individuals who feel that a “nonprofit” and “tax-exempt” entity are the same thing.  However, this is not the case and there is an important distinction between the two concepts. Nonprofit status is a state law concept.  Nonprofit status may make an organization eligible for certain benefits, such as state sales, property and income tax exemptions.  In Florida, certain not-for-profit organizations are exempt from sales and use tax on purchases and rentals of tangible personal property if that property is used in carrying out the organization’s not-for-profit activities.  An entity looking to receive an exemption from More…

Jul 072011
 
IRS Video - How To Reacquire Tax-Exempt Status

Recently we published a post detailing the IRS’ announcement that approximately 275,000 organizations have lost their tax exempt status for failure to file legally required annual reports for three consecutive years.  In response to this issue, the IRS has now released a video which is available on the IRS YouTube Channel that details how an affected organization can get back their tax exempt status. Hopefully, this easily accessible resource will provide some relief if your organization is one of those whose status was revoked.  Of course, dealing with the IRS can be confusing even when they provide helpful videos as More…