In the wake of the devastation caused by Hurricane Sandy, the Internal Revenue Service announced an expedited review and approval process for organizations formed to aid victims of Sandy that are seeking tax-exempt status.  Qualifying organizations still need to apply for tax-exempt status by filing a Form 1023 with the IRS. However, if they write

The Lancaster County Community Foundation has announced “The EXTRAordinary Give,” a unique event that will help local community benefit organizations raise funds.  The Foundation has set aside $250,000 to match a portion of donations made to preregistered nonprofits on November 30, 2012.  There will also be an additional $50,000 in prizes.  This  program will be

The goal of most parents is to leave some sort of inheritance, be it large or small, to their children. However, several clients have recently been asking me about a Pennsylvania law that could cause the opposite result and leave their children with significant debt. The law they are asking about is commonly referred to

Some charities and other tax exempt organizations rely heavily on contributions from generous donors. On the other hand, those donors benefit by being able to deduct those donations from their taxes. However, a recent decision by the US Tax Court makes it clear how a simple mistake by the tax-exempt organization can prevent a donor from making the deduction.

In Durden v. Commissioner, TC Memo 2012-140, the Court prevented a married couple from claiming $25,000 in charitable deductions. The donations had been made to a church in various amounts throughout 2007. The Internal Revenue Service initially disallowed the deductions, and the taxpayers responded by producing records of their donations, which included a January, 2008 letter from their church acknowledging the donations.

Unfortunately, the 2008 letter did not include any statement that the church had not provided goods or services to the taxpayers in return for their donations. Because applicable tax laws specifically require such a statement, the IRS rejected the 2008 letter as an adequate acknowledgment of the donations. 

In response, the taxpayers obtained a June, 2009 letter from the church that included the required statement, however the IRS rejected the 2009 letter as untimely. The IRS based their decision on a specific tax law that requires taxpayers to receive acknowledgments from charities by the date on which they file their returns for the year the deduction is claimed, or by the return due date, including any extensions, whichever occurs earlier. In this instance, the 2009 letter was received by the taxpayers well after the return was filed in 2008.

Continue Reading Charitable Deductions Denied by Insufficient Acknowledgment

One important point I convey to my clients who are charged with driving under the influence of alcohol ("DUI") is the severity of the penalties they face if they are caught driving while their licenses are suspended. The penalties include substantial fines ($500-$1,000), jail time (60-90 days) and a 12 month extension of the suspension.

Now that we are living in the age of the internet, businesses are discovering the importance of marketing themselves online. However, some businesses are finding themselves in trouble under the US Copyright Act for inadvertently posting images or photographs on their websites without the proper permission to do so.

The following is a typical scenario in