In a world of almost non-stop negative news and reports of violence it’s hard to imagine the world is headed in the right direction. But, don’t believe everything you see on the news. Americans remain more committed to ever to helping their fellow Americans and those...
No. Although you must file IRS Form 990 with the Internal Revenue Service (IRS) annually, nonprofit corporations are generally not required to file Form 990 with the Texas attorney general or the secretary of state. For other questions regarding your nonprofit...
An exempt organization that has changed its name must report the change on its next annual return (Form 990 or 990-EZ). An organization that does not file an annual return (for example, an organization that instead files Form 990-N, the e-Postcard, or an organization...
A private operating foundation is not subject to the tax on net investment income if it is an exempt operating foundation. In addition, private foundations may make grants to exempt operating foundations without complying with the expenditure responsibility...
There is an excise tax on the next investment income of most domestic private foundations. This tax must be reported on Form 990-PF, Return of Private Foundation, and must be paid annually at the time for filing that return or in quarterly estimated tax payments if...
Yes, in accordance with Section 22.151 of the Texas Business Organizations Code (TOB), a nonprofit corporation may have one or more classes of members or it may have no members at all. If the corporation has one or more classes of members, the corporation's...
Section 22.103 of the Texas Business Organizations Code (TBOC) controls. Sec. 22.103 provides that a provision of a certificate of formation of a corporation that is inconsistent with a bylaw controls over the bylaw, except as provided by Subsection (b). And,...
An organization that claims tax-exempt status under section 501(a), but has not yet received an IRS letter recognizing exempt status, is generally required to file an annual exempt organization return . If an annual return is due before the organization has submitted...
That depends. There are several situations where that is entirely permissible. Section 22.102 of the Texas Business Organizations Code (TBOC) controls Section 22.012 provides that: The initial bylaws of a corporation shall be adopted by the corporation's board of...
The IRS established rules against excess business holdings intended to keep private foundations from owning a significant stake in a family business. Breaking those rules can have serious consequences for the foundation. Excess Business Holdings Defined: The excess...
I just setup a private family foundation. Can I hire a staff to run it? The answer often turns on the size of the foundation assets and its total annual charitable budget. The real question is how much staff you can afford. The IRS mandates an annual charitable...
I just setup a private family foundation. Can I hire a staff to run it? The answer often turns on the size of the foundation assets and its total annual charitable budget. The real question is how much staff you can afford. The IRS mandates an annual charitable...
Yes, this is possible. However, the reverse is not true. Section 10.108 of the Business Organizations Code (BOC) prohibits a Texas nonprofit corporation may not convert to a for-profit entity. If your wish to merge your for-profit entity with a nonprofit, there are...
Generally speaking, yes. Appointing children or other family members as officers or directors is common. This practice makes it possible for your to perpetuate a philanthropic culture within your family and helps to ensure family involvement across multiple...
In answering our question, we need to know who the intended recipient is and how much the company is proposing to contribute. Both are vital to determine whether a company can receive a charitable contribution deduction of a gift and, if so, how much of a deduction...
The organizer or organizers of the nonprofit corporation must execute, acknowledge and file the certificate of formation. Under the Texas Business Organizations Code (TBOC), only one organizer is required and the TBOC provides that any person, partnership, association...
We have not filed our IRS Form 990 and its going to be late. What can we do? All three returns — Form 990, Form 990-EZ and Form 990— are due by the 15th day of the 5th month after your organization's accounting period ends. When your organization was setup you...
For a seemingly simple question, the answer can be quite complex. The short answer is, it depends. I am not an immigration lawyer, but I am quite familiar with nonprofits. Current immigration regulations will allow an H-1B visa holder to "work" for anyone other than...
Let's assume you volunteer 6 hours a week in the office of a qualified organization. The receptionist is paid $10 an hour for the same work. It only makes sense that the value of your time is at least $60.00 and a charitable deduction would be available....
You can deduct as a charitable contribution any unreimbursed expenses you have while in a permanent diaconate program established by your church. These expenses include the cost of vestments, books, and transportation required in order to serve in the program as...
If you pay a qualified organization more than fair market value for the right to attend a charity ball, banquet, show, sporting event, or other benefit event, you can deduct only the amount that is more than the value of the privileges or other benefits you receive....
Yes, but with some conditions. Under the U.S.Israel income tax treaty, a contribution to an Israeli charitable organization is deductible if and to the extent the contribution would have been treated as a charitable contribution if the organization had been created...
Generally, you cannot deduct a charitable contribution of less than your entire interest in property. A contribution of the right to use property is a contribution of less than your entire interest in that property and is not deductible. For example, you own a...
First, it's helpful to understand that Texas law provides for unincorporated nonprofit associations. Texas law concerning unincorporated nonprofit associations is codified as chapter 252 of the Texas Business Organizations Code (BOC). A "nonprofit association" is...
Every organization that qualifies for tax exemption as an organization described in section 501(c)(3) is a private foundation unless it falls into one of the categories specifically excluded from the definition of that term (referred to in section 509(a)). In...
Answer: The IRS sometimes recognizes a group of organizations as tax-exempt if they are affiliated with a central organization. This avoids the need for each of the organizations to apply for exemption individually. A group exemption letter has the same effect as an...
Answer: Yes. If your Canadian donors have U.S. income, they can generally claim any gifts to U.S. charities that would be allowed on a U.S. return. In general, Canadians can claim the eligible amount of their U.S. gifts up to 75% of the net U.S. income they report on...
A cash contribution made for the use of a public charity is deductible up to 30% of the donor's adjusted gross income for the tax year; a contribution of property made for the use of a public charity is deductible up to 20% of the donor's adjusted gross income for the...
If contributions to a church fund are earmarked by the donor for a particular individual, they are treated, in effect, as being gifts to the designated individual and are not deductible. Therefore, placing a check marked "For Pastor John Doe" in the donation box would...
Question: Is there a faster way to obtain tax-exempt status for my charity? Answer: Currently, the IRS has more than 60,000 501(c)(3) applications in its backlog, with many of them pending for nine months. IRS Form 1023 is a 26-page monster and requires on average 100...
Question: What’s the Difference Between a Church and a Religious Organization? Answer: Let’s first do what we can to define the terms and then address the question. As we all know the Internal Revenue Code (IRC) is not always an easy read, but here are a few facts:...
Question: What is the Difference Between a 501(c) (3) and a 501 (c) (4) Organization? Answer: A 501(c)(3) organization is a nonprofit organization created for charitable, religious, educational, scientific, or literary purposes. The main benefit of this status is that...
Question: What are “directly connected” expenses? Answer: Deductions incurred solely because of the unrelated business are known as directly connected expenses. These are expenses that wouldn’t be incurred if the unrelated business didn’t exist. For example, the...
If your nonprofit engages in inactivity unrelated to its exempt purpose, you may have Unrelated Business Income that is taxable. Unrelated Business Income is the income from a trade or business regularly conducted by an exempt organization and not substantially...
Question: What are “dual use” expenses? Answer: If an expense is incurred both to carry on exempt functions of your nonprofit and to conduct an unrelated business, then you have what is known as a dual use expense. For example, let's assume your nonprofit’s president...
Question. Can I use federal grant money to fund lobbying efforts of my Nonprofit? Answer: No, nonprofits that receive federal funds may not use funds received by the nonprofit as a result of a contract or grant to attempt to influence any federal or state legislation,...
