Late gift from the FEC

The FEC is in the midst of a serious political squabble that will essentially shut down new business starting January 1st. Thankfully, before the lights went out the Commission released the Explanation and Justification document (PDF) on their new electioneering communications rules (PDF). AFJ has the summary here. Recommended reading if you're a nonprofit that uses broadcast ads at all during election season!

Creative Commons licensing primer

A preview of sorts for the upcoming New Media screencast that I'll have available... here is a screencast on Creative Commons licensing. The interesting aspect of this screencast is that it is an example of a remix of a creative commons licensed work. The original was a static comic with a script here. How is this important to nonprofits? It's useful to know what kinds of artwork, music and other works are available for you to use without paying premium license fees. It's also helpful to support the (usually) independent artists that use these licenses as a way of getting their work out to the world.

Enjoy the screencast and feel free to pass it along... after all, it's a Creative Commons licensed video!

Nonprofit law Podcast #25: End of the year guide to recordkeeping

The podcast got a nice mention by Texas Nonprofits in an article on their site... check it out here.

This is all just in time for the latest Nonprofit Law Podcast... in number 25 we take a look at end of the year recordkeeping tips for nonprofits.

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More audits on the way for nonprofits?

That's a shudder you hear from every person who would be responsible for handling an audit of a nonprofit. Reuters has the scoop here.

IRS regulation of nonprofits

Steven Miller, IRS Director of Tax Exempt and Government Entities, gave a speech recently on nonprofits. As the Nonprofit Law Prof blog reports, the most provocative part of the speech:

Please understand that I am not saying that no valid differences exist between the non-profit and for-profit sectors. I am asking something more nuanced: to what degree has the non-profit sector drifted toward the commercial sector, and to what extent should it be taxed like the for-profit sector? And even where the exempt sector acknowledges unrelated commercial activity, why are so many organizations declaring losses on these endeavors? It seems as if the IRS needs to police this Drift Line.

Newcomers to the nonprofit world are often surprised to the extent nonprofits (particularly 501(c)(3)s) are able to engage in commercial-like activities. Will the IRS start taking a harder line?

'Tis the season...

... of articles on shady nonprofits. Check out MSNBC. It's also the season of calls for more nonprofit regulation... the question is whether or not the few bad apples should put more burdens on the good nonprofits? Balance is key.

"Nonprofits Become A Force in Primaries"

The Washington Post reports on the importance of nonprofits in the 2008 election cycle. be sure to check out the response to the article by AFJ and Chronicle of Philanthropy as well.

Justice Talking

NPR's Justice Talking covers the tricky speech vs. election regulation topic this week:

The presidential election is less than a year away and a Supreme Court ruling could change the kinds of advertisements we see and hear in the days running up to an election. Also, some are questioning whether reporters need a law to protect them from being forced to reveal their sources. On this edition of Justice Talking: how the First Amendment affects political campaigns, blogs, corporations and journalists. Parts of this program were taped in front of an audience at the annual convention of the National Communication Association.

Check out the audio here (mp3).

File this under, "don't do it"

The Chronicle of Philanthropy reports...

The Internal Revenue Service has revoked the tax-exempt status of a California charity after the agency determined that the charity was funneling money to the campaign fund of a former state official.

That's pretty much the #1 no-no under tax law. Some of the folks in the now-former charity have some explaining to do to law enforcement, I suspect...

Nonprofit Law Podcast #24: Charitable solicitation registration

Nonprofit Law Podcast #24 is up.... this week we cover some aspects of charitable solicitation registration. Check out the shownotes and resources at nplawcast.com!

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Lots of great nonprofit resources

This month's edition of Harmon Curran's Navigator is full of great information:

IRS Releases Variety of New Guidance for Exempt Organizations

IRS Issues New Guidance on Valuing Donated Property

IRS Publishes FAQ Sheet for E-Postcard Filing

IRS and Independent Sector Issue Good Governance Guidelines for Charitable Organizations

Check it out at harmoncurran.com/navigator.

Nonpartisan candidate questionnaire

I've spoken about some of the best practices on nonpartisan candidate questionnaires by 501(c)(3)s in Nonprofit Law Podcast #16. For a little real-life example on how to craft a cover letter to candidates laying out the ground rules, check out the letter to presidential candidates by Midwest Democracy Network. Specifically:

First, we intend to communicate your answers fully, accurately, and without
edits, including spelling and grammar errors. All candidate responses will be released at one time—on October 31.

This is a good way of demonstrating that there is no filter of bias by the organization... what the candidates write down (including typos) end up the report.

Second, the Network will not publicly critique, comment on, or editorialize about your or any other candidate’s answers; the job of evaluating, comparing, contrasting and judging responses to the questionnaire will be left entirely to individual voters, readers, journalists and opposing candidates.

This is critically important... some 501(c)(3)s will continue advocacy simultaneously with their publication of these nonpartisan voter guides, and that can become problematic from a tax law perspective (remember, no partisan electioneering allowed for 501(c)(3)s).

Third, if you fail to submit a completed questionnaire by October 15 or leave certain questions unanswered, those omissions will be noted in a neutral and non-judgmental way in the Network’s published and web-based reports and press materials.

This paragraph gives notice that the results will be published even if some candidates don't respond. This was important because only 2 of the primary candidates responded.

And finally, we ask that you respect the word limits specified in the questionnaire’s “comment” sections as determined by the word count feature of your computer software.

Some candidates will write a treatise if you don't lay down some rules. This is a good idea.

Check out the questionnaire and responses over at Midwest Democracy Network.

More on Oral Roberts University

ORU President Richard Roberts resigned yesterday following the continuing scrutiny caused by some very serious allegations that, if true, could spell serious tax problems for the nonprofit university. I've posted before about some of the issues... more to come to be sure.

New 990 on the way

I've posted over the past few months about the soon-to-come new Form 990 that most nonprofits will have to use starting in 2009. The Chronicle of Philanthropy reports that the IRS is implementing changes from the comments filed earlier this year from the nonprofit community. The final version should be available as early as December.

More on FEC ad rules

The Washington Post blog, The Trail, has a nice roundup of voices on the new FEC advertising rules. Save it for halftime of the Lions game tomorrow... or not. Happy Thanksgiving!

UPDATE... more here from The Hill.

UPDATE from the election law listserve, an interesting observation from Brian Svoboda:

The FEC is simply setting itself up for the same dialectic that has long characterized its enforcement process: (1) agency gives example of what is prohibited; (2) sponsor crafts ad to hew away from the prohibited example; (3) reform advocates deride supposed toothlessness of agency prohibition; (4) agency responds by targeting sponsors; thus prompting (5) continued reform community derision, and howls from the regulated about the lack of fair notice.

Sounds about how it will go.

Seen But Not Heard: Strengthening Nonprofit Advocacy

Gary Bass and Kay Guinane of OMB Watch co-authored Seen But Not Heard: Strengthening Nonprofit Advocacy along with other OMB Watch staffers... the book's topic was the subject of Jeffrey Birnbaum's column in yesterday's Washington Post. I've known Gary and Kay for several years, dating back to my AFJ days. I'll definitely be picking up a copy...

FEC weighs in on WRTL with rulemaking

The FEC today voted on a rule to harmonize federal law with the ruling in Wisconsin Right to Life... broadcast ads mentioning federal candidates near set times prior to elections can only be regulated, under the ruling, if there is "no reasonable interpretation other than as an appeal to vote for or against a specific candidate."

So, this leaves the door wide open for more issue ads during elections. Bob Bauer has a good post on the matter... I tend to side with his point of view on this issue.

Nonprofit Law Podcast #23: Should we file an amended tax return?

Nonprofit Law Podcast #23 goes over a few scenarios where your nonprofit may want to file an amended tax return. Check out the shownotes and resources at nplawcast.com!

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New lobbying disclosure forms online

This does not apply to the vast majority of nonprofits, but for those readers that engage in a fair amount of lobbying of members of Congress, you'll want to read on. AFJ reports:

The U.S. House of Representatives and Senate recently announced new federal lobbying disclosure report filing procedures that will allow lobbyists to make one single electronic filing.

In September of this year the President signed into law the Open Government Act of 2007, which amends the federal Lobbying Disclosure Act of 1995 (see our analysis of the lobbying and ethics changes). Previously, lobbyists had to file separately with both the Senate and House and follow their separate requirements. The Secretary and the Clerk have streamlined the requirements and as a result lobbyists may file their forms at a single electronic location.

The new forms that enable simultaneous filing with the Clerk and Secretary will be available beginning December 10, 2007. These forms may be used for the 2007 Year End filing period and may be downloaded from the House or Senate websites. The Secretary and Clerk will accept previously issued registration and reporting forms until March 15, 2008, after which you must use the new forms and file electronically.

So, if you're a covered nonprofit, get ready and download those reporting forms!

More on 501(c)(4) donations

The Chronicle of Philanthropy picked up on the LA Times article I posted the other day on 501(c)(4)s getting more attention from donors who wish to have more impact (anonymously) with their donations. It will be interesting to see if the reform community turns their attention to 501(c)(4)s if there is perceived abuse.