An officer of a nonprofit uses his personal credit card to pay the organization’s bills, and then submits a voucher to be reimbursed so he can earn a 2% credit for goods purchased and keep it for his personal use. Should the officer be doing this on a regular basis?
If our 501(c)(3) nonprofit has a raffle and the prize is worth more than $600, do we have to advise winner and tell the IRS of the winnings? If we offered the same items through an auction format, and the value of each item was less, would there be an obligation to advise the highest bidder of any tax burden. We are currently raffling sports tickets that have a value of either just under or just over $600.
You can discuss your personal nonprofit legal questions directly with editor Don Kramer. We can schedule a phone call at a mutually agreeable time, usually within two business days of your request.
You can ask about stories in our recent issues, one of our recent questions, or a particular question of nonprofit law facing your organization. Feel free to gather your people around your conference phone if you want others to hear the answers.
Our 501(c)(3) private foundation owns only one asset, a 7-year-old two unit, residential building. Because our membership dues are $10/year, we take in only $200 a year in donations. Our two rental units bring in about $12,000 a month. Soon we will pay off our mortgage. Our predicament: Because of the IRS “5% rule,” we have to give away all but a few hundred dollars annually. We do not have enough kept in reserves. We think we would like to re-incorporate, and/or do whatever, to avoid the "5% rule". We are all volunteers. What should we do?
The essential tax reference book for every nonprofit.
Nonprofits enjoy privileges not available to other organizations. But these privileges come at a price: Nonprofits must comply with special IRS rules and regulations. This book covers what your organization must do to maintain its tax-exempt status.