While those working in social enterprise are still grappling with how to define it, Professor of Law Lloyd Hitoshi Mayer of Notre Dame Law School takes a look at social enterprise through the lens of domestic tax law, and explores whether it is necessary or desirable to modify existing law to better accommodate social enterprise. Read the paper here.

See Mayer, Lloyd Hitoshi, Creating a Tax Space for Social Enterprise (June 22, 2017). Notre Dame Law School Legal Studies Research Paper No. 1724. Available at SSRN: https://ssrn.com/abstract=2991120

Donating Fund InterestsDue to increased valuation of public and private equities, coupled with the upcoming end of the sunset provision that allows hedge fund managers to defer taxation on fees earned offshore,[1] there is an increased interest among hedge fund and private equity managers to donate a portion of their fund interests to charity.  The goal is to allow a manager to avoid ordinary income or capital gains tax and/or to obtain a tax deduction while accomplishing his or her philanthropic goals.  In order to make the most of any such charitable giving plan, managers need to appreciate that the amount of any charitable deduction will vary depending on the character of the donated property and the type of organization that receives the gift.

Continue Reading Donating Fund Interests: A “Why Now?” and “How To” Primer

photo-1454165804606-c3d57bc86b40The February 15, 2017 deadline for nonprofit organizations in California seeking to initially obtain or renew exemption from property taxes is quickly approaching, and there are changes to the reporting requirements if your organization allows third parties to use your property.

An increased concern amongst many tax-exempt organizations is how to report use of their property by private persons or non-exempt organizations.

Continue Reading Annual Filing for Welfare Exemption Due On or Before February 15th

voteA Brief Case Study:  Your nonprofit’s founder sends out an email in their official capacity to all of its members urging the them to vote for or against a political candidate or for or against a local proposition.

It may be a well-intended gesture, but a mistake that could result in excise taxes or the potential loss of your organization’s tax-exempt status.

Continue Reading What Your Nonprofit Needs to Know Before Advocating a Political Agenda

The case of Salus Mundi Foundation et al v. Commissioner

Transferee LiabilityOn August 15, 2016, the Tax Court decided in Salus Mundi Foundation et al v. Commissioner, T.C. Memo. 2016-154, that two foundations were liable as transferees for a corporation’s unpaid federal tax liability after another foundation distributed to the foundations the proceeds of the sale of the corporation’s stock.

The history in this case involves a marital trust that initially owned all of the stock in a C corporation called Double-D Ranch.  Later, a portion of the stock was transferred to the Diebold Foundation in New York.  Subsequent to that, the Diebold Foundation in New York sold the stock and distributed the proceeds from the sale of Double-D Ranch stock to three foundations formed by the Diebold children, pursuant to a New York state-approved plan of dissolution.

Continue Reading Transferee Liability: The [Unlikely] Situation that your Nonprofit Receives a Charitable Gift with Expensive Tax Strings Attached

SOCAP_logoThis month more than 2,500 people gathered at the ninth Social Capital Markets (SOCAP) conference, billed as the intersection of money and meaning.  The conference is designed to be the place where businesses built to solve the biggest problems meet investors, peers, partners and those who make it happen.  Launched in 2008 in the midst of the economic crises, the conference has grown is size and scope. Coblentz was thrilled to have had the opportunity to sponsor, attend and speak at this event and we came away with the following takeaways:

Continue Reading Takeaways From SOCAP16: The Social Capital Markets Conference

photo-1454165804606-c3d57bc86b40Those responsible for managing a private foundation’s investment assets may not always understand the unique fiduciary and tax constraints imposed on private foundations and their managers by both state and federal law.

Why is this important? 

Running afoul of the rules can result in costly excise taxes that can be imposed on both the foundation and its managers, and in the most extreme cases, can lead to revocation of tax-exempt status.

Continue Reading Investing Private Foundation Assets: What Every Foundation Manager Should Know

A promise to give is not a guaranteed charitable gift.

smartphone-586903_1920In an open letter to their newborn daughter last December, Facebook CEO Mark Zuckerberg and wife Priscilla Chan announced they will eventually give 99 percent of their Facebook shares during their lives to a variety of important social causes.  Over the past several months, commentators have expressed both enthusiasm and concern with the manner in which the couple chose to commit their wealth to advancing these causes.  Continue Reading What Does the Chan Zuckerberg Initiative Mean for Modern Philanthropy?

tax-468440_1920In July of 2014, the Internal Revenue Service (IRS) introduced a shorter application form to help small charities apply for 501(c)(3) tax-exempt status more easily.  At that time, the Form 1023-EZ required a $400 user fee to be submitted with the application.

Effective July 1, 2016, the cost will drop to $275 for Form 1023-EZ filers, pursuant to recently issued Revenue Procedure 2016-32.

Continue Reading Form 1023-EZ Filers Benefit From Reduced Fee