An unusual alliance of religious and secular groups has recently called for the IRS to clarify its rules regarding non-profit organizations and their political activity. Leaders from the Evangelical Council for Financial Accountability (ECFA), Alliance Defending Freedom (ADF), the Public Citizen, and the Center for American Progress (CAP) met in Washington to discuss what the IRS could do to lend some clarity to this issue. ECFA seeks to make Christian non-profit organizations accountable through adherence to its Seven Standards of Responsible Stewardship; ADF has long advocated more freedom for ministers in addressing political issues from the pulpit. The Public Citizen is a non-profit, consumer rights advocacy group and think tank while the Center for American Progress is a progressive public policy research and advocacy organization. According to CAP, the Read More
Despite the IRS ban on church political activity, there is a large and growing group of pastors and churches who are actively supporting the repeal of the Johnson Amendment banning church and non-profit political activity.
Each year in October, the Alliance Defending Freedom (ADF) sponsors Pulpit Freedom Sunday, in which pastors take to the pulpit and engage in banned political activity. In 2014, over 1,800 pastors participated with the large majority of them preaching sermons presenting their view of the biblical perspectives on the positions of elected candidates and signed a statement agreeing that the IRS should not control the content of a pastor’s sermon. Additional pastors signed the statement, but did not preach to that effect. Read More
We previously discussed the prohibition against a church or religious organization from participating in political campaign activities. The specific prohibitions that are a part of the law were discussed. However, a church or religious organization is not being placed in a situation where is cannot express opinions on the issues of the day, nor are they expected to “put its head in the sand” in regard to the political process.
A church or religious organization is permitted to engage in lobbying activities. These activities are limited, however, as the organization must maintain a focus on its exempt purpose. If the IRS determines that the organization is devoting more than an “insubstantial” part of its total activities during the year to lobbying activities, its tax-exempt Read More
Our society is very much a political society. Even though not everyone may vote for a number of reasons, citizens are aware of elections and often the issues that are matters of discussion. Opinions are plentiful, some are not factually-based, but that does not deter the individual from expressing his or her opinions. Political campaigns are pervasive – we see advertising on various media, our mailboxes are filled with flyers from competing candidates, our phone often rings with pitches from various candidates. With everyone seemingly getting in on the action, there may be a temptation for a church or non-profit organization to throw in their two cents worth.
At one level, it makes sense for an organization to take a stand in favor or opposition to a candidate. For example, a church may be a strong supporter of the nation of Israel. One Read More
An endowment is a donation of money or property to a non-profit organization for the ongoing support of the organization. It may be structured that the organization leaves the principal amount intact and is only permitted to spend the income from the investments in the endowment funds. Less commonly, the gift may be structured allowing the organization to spend the principal amount. If this is the case, there may be restrictions placed upon the amount of principal that may be spent annually. Many non-profit organizations, most notably colleges and universities may have endowments of millions of dollars. It is less common for a church to have endowment funds, although it is not unheard of.
Not everyone favors a church having endowment funds. Some feel that any funds in Read More
The Tax Reform Act of 2014 is currently in the House of Representatives. This law is a major reform effort and is almost 1,000 pages long. Congress is expected to take action on this proposal after the November elections. While it is often risky to speculate what changes Congress will enact, this proposal has several significant changes that will affect non-profit organizations. In a previous article (Potential Tax Changes Affecting Charitable Contributions) the proposed changes in regard to charitable contributions was discussed. This article deals with other changes that would affect non-profit organizations.
The proposed legislation would levy a one per cent excise tax on net investment income of Read More
Hello Readers! A two month hiatus from tax-blogging is a long time to be away. Especially at this time with so many changes- exciting or scary- happening in the tax-world! My first born heading to college was definitely more challenging than I expected and yes, that’s my excuse and I am sure you would agree that it’s a good one?
Well, as if sending off my son to college wasn’t exciting enough, I filed for non-profit status for a client using the new Form 1023-EZ. This process used to be a long, arduous and complicated one. Most organizations contemplating going down that route had to wait months after filing for determination of non-profit status to hear back from the Internal Revenue Service, often not being able to raise as much capital as they expected. Read More
For the very first time, members of non-profits can easily access pay per view video education that can literally save their organization! Stuart Sobel, the only man known as the “Guru of Giving”, knows the IRS rules and regulations for tax exempt organizations inside and out. After working for the IRS for thirty years he became an expert on the subject matter. Although Stu has used his tax exempt expertise to primarily teach the tax professionals, TaxConnections is now making these private educational opportunities available to Board Members and Members of non-profit organizations. Times are about to get better for the non-profits with access to these online and on-demand videos!
With more than 500,000 non-profits losing their tax exempt status in the past few years due to lack of compliance with IRS Guidelines, access to this extraordinary valuable on Read More