Wednesday, February 3, 2016

Celebrities' Foundations Need More Attention

As published in the Daily Tax Report, at the ABA Tax Section meeting last week, Andrew Morton, a partner at Handler Thayer LLP, opined that a good number of "high-profile charitable foundations" need substantially more oversight and legal assistance than they are currently receiving.  He clarified that the neglect of these organizations is not malicious or deliberate:  "Not because they are deliberately trying to manipulate the system, not because they're trying to do anything wrong, they just don't know. They don't get that a nonprofit is a corporation … it's a real thing. You have to take care of it.”  He explained that most of the problems that arise with such celebrity-affiliated foundations are due to a lack of written policies, such as conflict-of-interest and whistle-blower situations, and the lack of reporting those policies on the foundations' annual Forms 990.  In addition, these foundations are typically not aware of charitable registration requirements, which are governed by the states:  “501(c)(3) is an adjective—not a noun. You don't have a 501(c)(3). You have a state nonprofit corporation, which has been conferred tax-exempt status from the federal government,” he explained. “There are 51 jurisdictions that require compliance for nonprofits. The federal government has their requirements, but every state has a different landscape.”

 

Nicholas Mirkay

https://lawprofessors.typepad.com/nonprofit/2016/02/celebrities-foundations-need-more-attention.html

Conferences, Federal – Executive, State – Executive | Permalink

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