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Results for:   Topic: “Tax and Legal”  

Employee Compensation: Legal Responsibilities

As an employer, you are responsible for documenting that your employee is eligible to work in the United States. To do this, the employee must complete Immigration and Naturalization Service Form I-9, Employment Eligibility Verification. You, the employer, must keep this form on file for as long as the employee works for you. For small... Read More

Allocating Foundation Expenses for Tax Purposes

Under the Further Consolidated Appropriations Act of 2020, private foundations are now subject to tax at a flat rate of 1.39% of their net investment income, effective for taxable years beginning after Dec. 20, 2019. Private Foundations are also subject to the requirement of section 4942 that a minimum of 5% of the fair market... Read More

Lobbying: Is Incorrect Advice Inhibiting Your Ability to Act?

Most foundations cannot directly earmark money to support a lobbying campaign. (Community foundations and others that have public charity status are notable exceptions to this rule.) What constitutes lobbying, however, often is murky. Support for a public education campaign, for example, usually is not lobbying, assuming it does not urge lawmakers or the public to... Read More

Understanding the Excise Tax

Understanding the Excise Tax Although private foundations are exempt from the federal income tax, each private foundation must pay an annual excise tax on its net investment income.  Congress imposed this tax in 1969, arguing that the income was necessary to pay for the costs of auditing and monitoring private foundations. Historically, the tax was... Read More

Minimum Private Foundation Requirements

Here are the things a private foundation must do every year to remain a private foundation and stay out of trouble: Pay your annual excise tax on the foundation’s net investment income through quarterly estimated payments. File your federal tax returns and comply with state filing rules. Meet your annual minimum distribution requirement through grants... Read More

Are You Underestimating Your D&O Liability?

Even for nonprofit foundations with few or no employees, the risk of litigation is real—and rising. Why D&O insurance? Once assumed to be costly and once excluded from many nonprofit budgets as a result, D&O liability insurance has evolved into a broad, affordable, and important form of coverage for any foundation. Even if you have... Read More