Exempt Org. Resource Blog


ExemptOrgResource.com is an online resource for information and insight on the unique legal issues impacting nonprofit organizations. The site is designed to keep the nonprofit, tax-exempt organization community up-to-date on legal developments, changing regulations and good practices.

Recent Blog Posts

  • Law Passed Amending NPCL Over the summer, we posted about Bill No. A. 10365B/S. 7913, containing amendments to the New York Not-for-Profit Corporation Law (the “NPCL”) and the New York Estates, Powers and Trusts Law (the “EPTL”) here.  After introduction in May and passage by both houses in June, the bill was delivered to the Governor earlier this month and signed into law on November 28, with an effective date of May 27, 2017 (other than the change to Section 713(f) regarding employees serving as... More
  • New York Will Require Certain 501(c)(3) Organizations to Publicly Disclose Donors Bill No. A. 10742/S. 8160, introduced during the final hours of the spring legislative session and signed into law by Governor Andrew Cuomo, requires 501(c)(3) organizations to publicly disclose the identities of certain donors if those 501(c)(3) organizations make donations to 501(c)(4) organizations engaged in significant lobbying in New York.  These new disclosure requirements will take effect on November 22, 2016.   The new law also changes existing disclosure requirements applicable to 501(c)(4) organizations that lobby in New York.  The changes to... More
  • IRS Examinations: New Guidance and Issue Areas for Tax-Exempt Organizations Tax-exempt organizations will soon receive guidance regarding the issues most likely to trigger an examination by the Internal Revenue Service (IRS), says Sunita Lough, Commissioner of the IRS Tax-Exempt and Government Entities Division (TE/GE).  On a recent call discussing TE/GE’s newly released FY 2017 work plan, Ms. Lough indicated that this interim guidance, which will likely come in October, will be designed to provide nonprofits with a better understanding of how the IRS uses information document requests (IDRs) in order... More
  • Proposed Legislation Would Allow Limited Political Campaign Activity for Charitable Organizations Recently, we wrote about the absolute prohibition on political campaign activity by 501(c)(3) charitable organizations, and the importance of managing the use of social media to avoid violating these rules.  This prohibition has gained national attention during the 2016 election cycle, with Donald Trump vowing to repeal the “Johnson Amendment,” so named because then-senator Lyndon B. Johnson added the prohibition to the Revenue Act of 1954 (the precursor to today’s tax code) from the Senate Floor.  Now two members of... More
  • Trending Now: Political Activities and Social Media The 2016 U.S. presidential campaign has reached a fevered pitch, with a little over a month remaining before Election Day.  After Monday’s debate between Hillary Clinton and Donald Trump, the stakes are high and the American public is turning to social media to express powerful emotions ranging from excitement to exhaustion, and to support their chosen candidate (or oppose the other).  We previously reminded charitable organizations about the prohibition on direct and indirect participation by 501(c)(3)s in political campaign activities. ... More
  • IRS to Update 1967 Revenue Ruling Relating to Change of Domicile The Internal Revenue Service (the “IRS”) has announced plans to update Revenue Ruling 67-390, which requires an organization to “re-apply” for  tax-exemption if it changes its corporate structure, including in situations where an exempt organization reincorporates under the laws of another state (even where there is no change in corporate/charitable purposes).  In that revenue ruling, the IRS reasoned that the change resulted in the creation of a new legal entity, and every new legal entity must seek recognition of its... More
  • Court Dismisses Challenge to New York Donor Disclosure Requirement On August 29, 2016, the United States District Court for the Southern District of New York dismissed in its entirety a complaint against the New York Attorney General filed by Citizens United and Citizens United Foundation, challenging the Attorney General’s policy of requiring charities to disclose the names, addresses, and total contributions of their donors in connection with registration to solicit funds in New York.  The plaintiffs maintained, among other arguments, that this disclosure requirement was unconstitutional under the First... More
  • Fall into the GAAP: New Not-for-Profit Financial Reporting Standards Issued As we previously reported, in April 2015 the Financial Accounting Standards Board (“FASB”) circulated a series of proposed changes to generally accepted accounting principles applicable to certain not-for-profit entities in order to provide clearer information to donors, creditors, and other users of financial statements.  On August 18, FASB issued the related accounting standards update.  The new standard is meant to improve the way not-for-profit organizations present and disclose information about net asset classes, expenses, investment return, liquidity and availability of... More
  • New governance requirements for committees and subcommittees of Delaware nonstock corporations A recently passed Delaware law contains new voting and quorum requirements for committees and subcommittees of nonstock corporations.  Specifically, the law amends the Delaware General Corporation Law (the “DGCL”) to define a quorum of a committee or subcommittee as a majority of the directors then serving on such committee or subcommittee and to define an act of a committee or subcommittee as the vote of a majority of its members at a meeting at which a quorum is present (previously, the... More
  • PATH Act 501(c)(4) Matters Update #2: Notification Requirement Clarified; Temporary Regulations and Notification Form Issued As specified in Notice 2016-09 (discussed in our recent blog post on the PATH Act), the IRS has issued temporary regulations describing new notification procedures and a notification form for certain (current and prospective) Section 501(c)(4) organizations.   Background   Section 506 of the Internal Revenue Code (the “Code”), enacted on December 18, 2015, as part of the PATH Act, imposes notification requirements on certain newly established (and already existing) Section 501(c)(4) organizations.   Section 506(a) requires an organization described in Section 501(c)(4) to notify the... More