EO Radio Show

Welcome to EO Radio Show - Your Nonprofit Legal Resource. I'm Cynthia Rowland, and this is episode 66 of EO Radio Show. Happy New Year to all of you! As most listeners are undoubtedly aware, 2024 is an election year, and that means that charities and private foundations need to refresh their understanding of election-year issues for organizations that want to remain exempt under Internal Revenue Code Section 501(c)(3).

This week's episode is a refresh of episode 6 of EO Radio Show, first released on July 7, 2022. Episode 6 covered the limitations of 501(c)(3) relating to candidate campaign intervention. I'll also refresh Episodes 7 and 8 in the next few weeks. These episodes address legislative lobbying by public charities and private foundations, which will also likely be hot topics in 2024. Check out the show notes for resources from the IRS on these topics, and check out the Farella Braun + Martel YouTube channel for the complete EO Radio Show playlist.

Resources:

Farella Webinar: Election Year Issues for Private Foundations and Public Charities

Bolder Advocacy Resource Library

IRS Chart: Common Tax Law Restrictions on Activities of Exempt Organizations

Treasury Regulation 53.4945-3, Voter Registration Drives

Instructions for IRS Form 8940, Request for Miscellaneous Determinations, used to obtain advance approval of certain voter registration drives under IRC 4945(f)

Farella YouTube podcasts

If you have suggestions for topics you would like us to discuss, please email us at [email protected].

DISCLAIMER: This podcast is for general informational purposes only. It is not intended to be, nor should it be interpreted as, legal advice or opinion.

Welcome to EO Radio Show - Your Nonprofit Legal Resource. In today's episode, the final episode on the new DAF regulations, we take a close look at the new Proposed Regulations 53.4966-2 and -5, which cover the definition of taxable distributions from donor advised funds and the onerous penalty taxes that can apply. When a fund is a DAF, and a distribution is a taxable distribution, significant penalties apply to the sponsoring organization and the donor advisor or fund advisor. This episode discusses the new guidance on what distributions are taxable and the amount of the penalty taxes imposed.

Resources:

Federal Register: Taxes on Taxable Distributions From Donor Advised Funds Under Section 4966

EO Radio Show - EP 64: Exceptions to the DAF Definition Under the Proposed Regulations

EO Radio Show - EP 63: New Proposed Regulations Defining Donor Advised Fund Terms

EO Radio Show - EP 62: An Introduction to DAFs and Overview of the Newly Proposed DAF Regulations

EO Radio Show - EP 61: In the Weeds With New Supporting Organization Regulations

EO Radio Show - EP 24: Nonprofit Basics: Supporting Organizations Part 2 - Orientation for Understanding Type III Supporting Organizations

EO Radio Show - EP 23: Nonprofit Basics: Supporting Organizations - Part 1

EO Radio Show – EP 29: Nonprofit Basics: What You Need To Know About Expenditure Responsibility

If you have suggestions for topics you would like us to discuss, please email us at [email protected].

Additional episodes can be found at EORadioShowByFarella.com.

DISCLAIMER: This podcast is for general informational purposes only. It is not intended to be, nor should it be interpreted as, legal advice or opinion.

Welcome to EO Radio Show - Your Nonprofit Legal Resource. Episode 64 continues the exploration of the new proposed regulations important to the administration of Donor Advised Funds.

The Internal Revenue Service and the Treasury Department published a Notice of proposed rulemaking on November 13, 2023, which was officially published in the Federal Register on November 14, 2023. The Proposed Regulations provide guidance to sponsoring organizations, which include community foundations and many other types of charities that maintain one or more DAFs. The Proposed Regulations are also important for persons involved with DAFs, including the donors, the donor advisors, related persons, and certain fund managers.

Episodes 62 and 63 covered the basic rules that apply to sponsoring organizations and DAFs and looked closely at the defined terms in Proposed Regulations. In this episode, we cover the important exceptions to the DAF definitions that take certain funds held by sponsoring organizations out of the onerous penalty tax regime that can apply to the operations of DAFs.

Resources:

Federal Register: Taxes on Taxable Distributions From Donor Advised Funds Under Section 4966

EO Radio Show - EP 63: New Proposed Regulations Defining Donor Advised Fund Terms

EO Radio Show - EP 62: An Introduction to DAFs and Overview of the Newly Proposed DAF Regulations

EO Radio Show – EP 10: Nonprofit Basics: Setting up a New Charity for Disaster Relief

EO Radio Show – EP 9: Nonprofit Basics: Charitable Support for Individuals Affected by a Disaster

If you have suggestions for topics you would like us to discuss, please email us at [email protected]. Additional episodes can be found at EORadioShowByFarella.com.

DISCLAIMER: This podcast is for general informational purposes only. It is not intended to be, nor should it be interpreted as, legal advice or opinion.

Welcome to EO Radio Show - Your Nonprofit Legal Resource. Episode 63 explores new proposed regulations important to the administration of Donor Advised Funds (DAFs).

The Internal Revenue Service and the Treasury Department published a Notice of proposed rulemaking on November 13, 2023, which was officially published in the Federal Register on November 14, 2023. The Proposed Regulations provide guidance to sponsoring organizations, which include community foundations and many other types of charities that maintain one or more DAFs. The Proposed Regulations are also important for persons involved with DAFs, including the donors, the donor advisors, related persons, and certain fund managers.

In the previous EO Radio Show, episode 62, I introduced the basic rules that apply to sponsoring organizations and DAFs and a brief summary of the highlights in the Proposed Regulations. This episode looks closely at the defined terms in Proposed Regulations sections 53.4966-1 and -3 and includes a brief summary of the highlights in the Proposed Regulations.

In upcoming episodes, we'll discuss the exceptions to the definition of a DAF, and the penalties that can apply if a DAF makes taxable distributions.

Resources:

Federal Register: Taxes on Taxable Distributions From Donor Advised Funds Under Section 4966

EO Radio Show EP 62: An Introduction to DAFs and Overview of the Newly Proposed DAF Regulations

EO Radio Show EP 61: In the Weeds With New Supporting Organization Regulations

EO Radio Show EP 23: Nonprofit Basics: Supporting Organizations - Part 1

EO Radio Show EP 24: Nonprofit Basics: Supporting Organizations Part 2 - Orientation for Understanding Type III Supporting Organizations

If you have suggestions for topics you would like us to discuss, please email us at [email protected]. Additional episodes can be found at EORadioShowByFarella.com.

DISCLAIMER: This podcast is for general informational purposes only. It is not intended to be, nor should it be interpreted as, legal advice or opinion.

Welcome to EO Radio Show - Your Nonprofit Legal Resource. I'm Cynthia Rowland, and episode 62 describes new proposed regulations important to the administration of donor advised funds. The Internal Revenue Service and the Treasury Department published a Notice of proposed rulemaking on November 13, 2023, officially published in the Federal Register on November 14, 2023.

These Proposed Regulations guide sponsoring organizations, which include community foundations and many other types of charities that maintain one or more donor advised funds. The Proposed Regulations are also important for persons involved with donor advised funds, including the donors, the donor advisors, related persons, and certain fund managers.

This episode introduces the basic rules that apply to sponsoring organizations and donor advised funds and includes a brief summary of the highlights of the Proposed Regulations.

Resources:

Federal Register: Taxes on Taxable Distributions From Donor Advised Funds Under Section 4966

If you have suggestions for topics you would like us to discuss, please email us at [email protected]. Additional episodes can be found at EORadioShowByFarella.com.

DISCLAIMER: This podcast is for general informational purposes only. It is not intended to be, nor should it be interpreted as, legal advice or opinion.

Welcome to EO Radio Show - Your Nonprofit Legal Resource. I'm Cynthia Rowland, and today's episode discusses highly technical Supporting Organization rules for public charity qualifications for charitable organizations. Last year, episodes 23 and 24 of EO Radio Show covered the complex rules that describe supporting organizations, which are a special classification of public charity for US federal income tax purposes. All supporting organizations must pass complicated tests intended to ensure that the supported organization is not effectively a private foundation. These rules were initially enacted in 2006, and proposed regulations were published in 2016. On October 13, 2023, the US Treasury released new final regulations that make minor changes to the Type I test and more significant clarifications to the Type III requirements. This episode outlines the changes made in these final regulations applicable to certain parts of the qualification criteria for supporting organizations.

Resources:

Federal Register: Requirements for Type I and Type III Supporting Organizations

EO Radio Show EP 23: Nonprofit Basics: Supporting Organizations - Part 1

EO Radio Show EP 24: Nonprofit Basics: Supporting Organizations Part 2 - Orientation for Understanding Type III Supporting Organizations

If you have suggestions for topics you would like us to discuss, please email us at [email protected].

Additional episodes can be found at EORadioShowByFarella.com.

DISCLAIMER: This podcast is for general informational purposes only. It is not intended to be, nor should it be interpreted as, legal advice or opinion.

Welcome to EO Radio Show – Your Nonprofit Legal Resource. I'm Cynthia Rowland, and this is episode 60 of EO Radio Show. This week's episode is a refresh of episode 10, first recorded on July 3, 2022. Episode 10 provided a checklist of considerations for nonprofit leaders when organizing a new charity to provide relief to individuals and businesses in the aftermath of a disaster.

Sometimes, it feels like I should rerun this episode every month since we seem to be in the midst of disasters in the charitable field all the time. While we seem to be on the other side of the COVID-19 pandemic, we still see a seemingly constant barrage of terrorist attacks, hurricanes, earthquakes, and other disasters around the world. The focus of this episode is on the many steps a new domestic U.S. charitable organization needs to take to be on a solid road to providing the support needed.

Also, for an episode that addresses the distinction between disaster relief for a charitable class as compared to a private benefit for a specific individual affected by a disaster, go back to episode 9 of EO Radio Show, and you'll find details there.

Resources:

Nonprofit State Filings YouTube playlist

Episode 5: Nonprofit Basics: Navigating the Complex Rules That Describe A Public Charity

Episode 9: Nonprofit Basics: Charitable Support for Individuals Affected by a Disaster

IRS Form 3833: Disaster Relief, Providing Assistance Through Charitable Organizations.

IRS Form 1023: Application for Recognition of Exemption Under Section 501(c)(3) of the IRC

IRS Publication 1771: Charitable Contributions and Substantiation Requirements

If you have suggestions for topics you would like us to discuss, please email us at [email protected].

Additional episodes can be found at EORadioShowByFarella.com.

DISCLAIMER: This podcast is for general informational purposes only. It is not intended to be, nor should it be interpreted as, legal advice or opinion.

Welcome to EO Radio Show – Your Nonprofit Legal Resource. I'm Cynthia Rowland, and episode 59 is the seventh in a series of Quick Tip episodes focusing on the details of state registration of nonprofit corporations.

In episode 38, we talked about filing in Delaware and California, which are the most frequently used by our clients - most of whom have a connection with California. Episode 40 focused on filings in Nevada and Arizona; 43 looked at Washington State and Oregon; 47 addressed Alaska and Hawaii; 52 looked at New York and New Jersey; and most recently episode 55 looked at Massachusetts and Connecticut.

With the help of Joe Hilliard, this episode looks at the basic state filing requirements for nonprofit corporations operating in Maine and Vermont. We'll work through the rest of the states in future episodes.

Resources:

YouTube channel

For Maine:

Maine Secretary of State Corporations page: https://www.maine.gov/sos/cec/

Maine current entity database: https://apps1.web.maine.gov/nei-sos-icrs/ICRS?MainPage=x

Maine nonprofit formation FAQ, including forms and fees: https://www.maine.gov/sos/cec/corp/nonprofit.html

Maine filing FAQ: https://www.maine.gov/sos/cec/corp/miscellaneous.html

Maine Domestic Nonprofit Articles of Incorporation form: https://www.maine.gov/sos/cec/forms/nonprofit/mnpca6.pdf

Maine Application for Authority to Carry on Activities form: https://www.maine.gov/sos/cec/forms/nonprofit/mnpca12.pdf

Maine Annual Report online form request: https://www.maine.gov/sos/cec/corp/annual.html

Maine Annual Report paper form request: https://apps1.web.maine.gov/online/aro/form_download.html

Maine Professional & Financial Regulation Charitable Solicitations Act Licensing website: https://www.maine.gov/pfr/professionallicensing/professions/charitable-solicitations-act

Maine Charitable Organization License Application: https://www.maine.gov/pfr/professionallicensing/sites/maine.gov.pfr.professionallicensing/files/inline-files/CHA-org-app.pdf

Maine Sales Tax Exemption FAQ: https://www.maine.gov/revenue/taxes/sales-use-service-provider-tax/tax-exempt-organizations

Maine Association of Nonprofits website: https://www.nonprofitmaine.org/starting-a-maine-nonprofit

For Vermont:

Vermont Secretary of State Business Services website: https://sos.vermont.gov/corporations/

Vermont current entity database: https://bizfilings.vermont.gov/online/BusinessInquire/

Vermont Nonprofit Corporation FAQ: https://sos.vermont.gov/corporations/registration/domestic-registration/nonprofit-corp/

Vermont Attorney General "Understand Your Responsibilities: Guidance for Board Members of Charitable Nonprofit Organizations in Vermont:" https://ago.vermont.gov/sites/ago/files/wp-content/uploads/2018/01/Charitable-Nonprofit-Board-Guidance.pdf

Vermont Forms and Fees FAQ: https://sos.vermont.gov/corporations/fees/#tnonprofit2

Vermont Annual Report online form request: https://sos.vermont.gov/corporations/renewals-updates/reports-renewals/annual-biennial-reports/

Vermont Office of the Attorney General Charitable Registration: https://ago.vermont.gov/divisions/charities-and-paid-fundraisers

Vermont Department of Taxes website: https://tax.vermont.gov/

If you have suggestions for topics you would like us to discuss, please email us at [email protected]. Additional episodes can be found at EORadioShowByFarella.com.

DISCLAIMER: This podcast is for general informational purposes only. It is not intended to be, nor should it be interpreted as, legal advice or opinion.

Welcome to EO Radio Show – Your Nonprofit Legal Resource. Today, I'm talking about the meaning of expenditure responsibility or ER grants made by private foundations. The term expenditure responsibility refers to the rules that a private grant-making foundation follows to avoid the onerous penalty tax on a grant or transaction that would otherwise be a taxable expenditure if made by the private foundation.

Taxable expenditures include various types of grants and expenses paid by private foundations, which the Internal Revenue Code prohibits. These types of prohibited payments include lobbying, politicking, and candidate campaign expenses; grants to individuals for travel, study, or other similar purposes unless specific requirements are met; and grants that are not for charitable purposes.

A final bucket of grant types that can cause a foundation to be penalized under these rules are grants made to organizations that are not classified as a public charity or an operating foundation unless the foundation exercises expenditure responsibility with respect to that grant.

So, this is where the ER rules come into play. Expenditure responsibility is comprised of five requirements. We'll walk through all five elements in this episode.

Resources:

Farella YouTube podcast channel

IRS Issue Podcasts for charities

IRS pages on Expenditure Responsibility:

• Terms of Grants - Private Foundation Expenditure Responsibility
• Terms of Program-Related Investments: Private Foundation Expenditure Responsibility
• Violations of Expenditure Responsibility Requirements - Private Foundations
• Pre-Grant Inquiry
• Treasury Regulations on Taxable Expenditures

If you have suggestions for topics you would like us to discuss, please email us at [email protected].

Additional episodes can be found at EORadioShowByFarella.com.

DISCLAIMER: This podcast is for general informational purposes only. It is not intended to be, nor should it be interpreted as, legal advice or opinion.

Welcome to EO Radio Show – Your Nonprofit Legal Resource. I'm Cynthia Rowland, and today we'll cover an important governance topic for all nonprofit organizations. That is, what leadership needs to know about internal investigations. I'm delighted to have Farella partner Aviva Gilbert with me today to answer a few frequently asked questions about internal investigations in the context of nonprofit organizations.

Resources:

Aviva J. Gilbert, Partner, Farella Braun + Martel

EO Radio Show EP #4: Internal Investigations for Nonprofits: A Means of Identifying and Addressing Misconduct Before the Regulators Come Calling

EO Radio Show EP #13: Nonprofit Basics: Document Retention Policies and Subpoenas, and a Conversation With Aviva Gilbert on Why Good Policies Matter

Internal Investigations for Nonprofits: A Means of Identifying and Addressing Misconduct Before the Regulators Come Calling (Article)

Investigations, Audits, Subpoenas, Oh My! (Webinar)

EO Radio Show Nonprofit Risk Management playlist

If you have suggestions for topics you would like us to discuss, please email us at [email protected].

Additional episodes can be found at EORadioShowByFarella.com.

DISCLAIMER: This podcast is for general informational purposes only. It is not intended to be, nor should it be interpreted as, legal advice or opinion.