Thoughts on Seminar – How to Keep Tax-Exempt Organizations in Compliance

On August 25, 2010, I served on the faculty of a National Business Institute seminar focused on keeping tax exempt organizations in compliance relevant with tax law. I personally spoke about annual reporting requirements, complying with rules on disclosures to potential donees when soliciting donations, appealing a revocation of tax exempt status and intermediate sanctions. 

Of particular interest to many in attendance was the ability to use the IRS Form 990 as a fundraising tool. Last September, I posted about this topic and discussed how non-profits can use the 990 to effectively convey their mission and several of their largest projects to the donating public.

Because of the tough economy, those in attendance were also interested in creative fundraising techniques. We discussed the potential pitfalls of straying from the organization’s mission to increase donations, such as the unrelated business income tax, the prohibition against private inurement, the private benefit doctrine and intermediate sanctions.

The attendees were also very interested in methods of educating their Board members about the compliance rules. We discussed implementing a conflict of interest policy designed to ensure that the non-profit organization is not dealing with a third party that is somehow related to a Board member or officer. Another good practice is requiring Board members and officers to sign annual statements that they received the conflict of interest policy, understand the policy and agree to comply.

While tax topics can be tedious for some, I genuinely enjoyed the opportunity to present on this subject and answer questions from various nonprofit representatives. It was rewarding to see so many people willing to put in the time and effort to help their tax exempt organization carry out its mission.