I am a board member of a 501(c)(3) charitable nonprofit wholly controlled by a 501(c)(7) tax-exempt social club. We are concerned about the issue of commingling funds. What are the key points for us to keep in mind?
Three words: Don’t do it.
Very different tax requirements apply to the two types of tax-exempt entities, and you could easily jeopardize either or both exemptions by making wrong allocations.
I am in a nonprofit organization and the Treasurer has kept the nonprofit's funds in a subaccount of his own account. He says he did this to avoid the banking charge.
Is he commingling the subaccount nonprofit funds with his other subaccount funds? —E.W.
I don't know if he is commingling with other subaccount funds, but the nonprofit would be wise to pay the banking fees to keep control over its own money. It is good insurance. —Don Kramer