Tax-exempt organizations

TOPICS / TAX

July 1, 2008

Capital With a Conscience

EXECUTIVE SUMMARY Private foundations must distinguish between what are sometimes called mission–related investments and program–related investments (PRIs). PRIs enable private foundations to make venture capital–type investments that might otherwise be penalized under the IRC as “jeopardizing,” that is, risky. Mission–related investments, although not technically defined, nonetheless have their

June 1, 2008

Supporting Org Guidelines Available

The IRS has produced guide sheets and explanations to help applicants for supporting organization status to determine which of the three types of supporting organizations outlined in IRC § 509(a)(3) they fall under. The guides, which include checklists for the organizational test, operational test, control test, relationship requirement and other

May 1, 2008

New Split-Interest Return Form

The IRS recently issued a revised Form 5227, Split-Interest Trust Information Return, for use in preparing returns for tax years beginning on or after Jan. 1, 2007. Among its numerous changes, the most significant are: Charitable split-interest trusts are no longer required to file Form 1041-A, Trust Accumulation of Charitable

April 1, 2008

Split-Interest Prohibition Upheld

The Third Circuit Court of Appeals joined other jurisdictions in affirming IRC § 2055(e)’s prohibition of charitable deductions from an estate for transfers of interests in trust property that are not definitely divided between charitable and noncharitable beneficiaries, even where the arrangement shows little likelihood of being abusive in the

March 1, 2008

New Form 990 Phased in for Smaller EOs

Smaller exempt organizations received transition relief as the IRS released its revamped Form 990, Return of Organization Exempt From Income Tax, for tax years 2008 and following. Organizations with gross receipts under $1 million or total assets under $2.5 million will be allowed to use Form 990-EZ for tax year

February 1, 2008

IRS Reminds EOs of Political Restrictions

Churches and other exempt organizations (EOs) must abide by laws prohibiting them from direct or indirect involvement in political candidates’ campaigns, the IRS reminded in a news release. Revenue Ruling 2007-41, issued last summer, provides scenarios of how the ban may be observed. Generally, tax-exempt organizations are forbidden to promote

January 1, 2008

IRS Workshops for 501(c)(3)

November 1, 2007

AICPA Assesses Form 990 Redesign

The AICPA proposed a list of suggestions for the IRS to mitigate what the Institute considers increased burdens that will result from the new draft of Form 990, Return of Organization Exempt From Income Tax. The AICPA’s 990 Task Force said the changes improve transparency of reporting, aiding in performance

October 1, 2007

NPO Compensation in the Spotlight

EXECUTIVE SUMMARY Intermediate sanctions impose a penalty tax on key employees of certain tax-exempt organizations who receive unreasonable compensation, and on managers who approve it knowingly. Intermediate sanction regulations provide a framework of appropriate policies and procedures regarding compensation for tax-exempt organizations. Intermediate sanction rules require organizations

August 1, 2007

Proposed New Form 990 Released

Form 990, Return of Organization Exempt From Income Tax, will have a new format the IRS hopes to roll out for the 2008 tax year, in the form’s first overhaul since 1979. The changes are designed to aid transparency, with the first page of the 10-page form (one more than

June 1, 2007

Highlights

FASB issued an exposure draft that calls for expanded disclosure about financial guarantee insurance contracts. The ED, Accounting for Financial Guarantee Insurance Contracts—an Interpretation of FASB Statement No. 60, would, among other things, reduce diversity in the way financial guarantee insurance contracts are accounted for by insurers. That diversity has