Negotiate the Terms of a D&O Policy A nonprofit organization needs insurance to protect its directors and officers from personal liability in the event of a lawsuit. Don't fall into the trap of thinking this coverage isn't necessary. Some states have "safe harbor" statutes that are supposed to protect directors and officers of nonprofit organizations from lawsuits. However, these statutes are not a substitute for directors' and officers' insurance. The protection varies by state and usually doesn't cover all damages and legal defense costs. D&O coverage is negotiable, so take the following steps before you get down to the specifics of your policy.  Read More
IRS Releases Final Regulations Did you know on December 20, 2007, the IRS released the redesigned Form 990 which had not been significantly revised since 1979? With this, final and temporary regulations were released the following year in 2008 in order to implement the redesigned form. Now the IRS has removed the temporary 990 regulation by the issuance of the final regulations in TD 9549. Effective Date: The final regulations are effective September 8, 2011 for taxable years beginning January 1, 2008. Read More Beware of Penalties in Transactions With Nonprofits Tax law provisions and IRS regulations may have a significant impact on improper transactions between top officials and a tax-exempt organization. The relevant provisions, which apply to all transactions with non-profit organizations after September 14, 1994, are commonly referred to as the "Intermediate Sanctions." These sanctions are designed to protect charities and donors from those insiders who wield the influence to permit excessive executive compensation. Read More Protect Tax-Exempt Status on the Internet The internet may be an ideal medium to expand the reach and reinforce the message of your nonprofit organization, but a few wrong clicks of the mouse could actually hurt your tax-exempt status. Selling on the internet, acknowledging contributors the wrong way online and linking to commercial sites could cause your organization trouble. The following are some issues you may want to discuss with your advisers. Read More
Operating Deficit Guarantees During 2007 a memo written by Mr. Choi, Director of Exempt Organizations rulings and agreements, was circulated by the IRS that established the criteria for exempt organizations to participate in low-income housing partnerships. This article will address the portion of that memo dealing with the effect of operating deficit guarantees on non-profit organizations’ exempt status. Read More | 
