IRS Summary

The 501(c)3 tax code specifically for organizations that are reserved for educational institutions, churches or other nonprofit organizations including what is often deemed as charitable (Lavarda, 2009). There are two main reasons that an organization will seek to attain a tax-exempt status with the federal government through the Internal Revenue Services (IRS). First, is to provide for their beneficiaries a tax-deductible contribution, which allows taxpayers benefits when paying their federal income taxes and secondly, simply is for organizations the ability to not pay federal income taxes (Lavarda, 2009; Arnsberger, Ludlum, Riley, & Statnton, 2008). Organizations who seek out the tax-exempt status do benefit from the protection that the tax code provides, however due to tax code regulations and reform, organizations that do not heed to the code may be in jeopardy of violating the code. This violation will result in the IRS revoking the tax-exempt status. For emerging organizations that are on the cusp of defining their affiliations in society must determine if applying for tax-exemption status is a profitable move. Due to the scrutiny of these organizations and such organizations must take into account the liability that comes with the tax exemption status. The liability is not one that an organization can take lightly, if an organization does gain tax-exemption status and then later fails to abide by the regulations, the risk is simple; the revocation of the

While Super PACs do need to make financial disclosures to the FEC on a monthly basis, their ability to take donations from corporations leaves them amble room to leave the names of their end donors undisclosed. Many Super PACs report donations as coming from one or multiple 501(c)(4) (politically active non-profit) organizations that do not have to disclose their donors. This is referred to as "the Russian nesting doll problem” among campaign finance reform advocates.

"The most obvious form of government aid to the faith based programs is the use of direct grants of public funds"(Pfeffer 163).  The money however is not just handed over to these faith-based charitable organizations.  These faith-based organizations must apply for the

In July 2014, Steven Nardizzi wrote an article, “Measuring Charity Effectiveness: Manage Your Mission, Not Your Rating” for Huffington Post, in which he stated “furthering our mission and broadening our impact was only possible by ignoring conventional wisdom about how nonprofits should be run” (Nardizzi, 2014). Nardizzi went on to state that nonprofits should disregard the pressure that ratings organizations generate for charities to decrease expenditures relating to fundraising and administrative costs. Instead, Nardizzi shared, WWP had chosen to appropriate funding to its efforts relating programs, staff, and infrastructure and fundraising. By doing so, WWP warranted that it could continue to develop in a manner that accomplished its mission while meeting the needs of its various constituents. Nardizzi did acknowledge that they could improve within certain areas such as “measuring and reporting our impact, holding ourselves and our industry to the highest of ethics and profession, informing government officials about the appropriate ways to measure charity effectiveness, and starting a public dialogue about these issues” (Nardizzi, 2014). Nardizzi’s position on the complaints did not acknowledge any misdoings on the part of WWP. Instead, he defended the organization’s choice to disregard charity rating systems—describing them as schemes that do not work. While it is true that nonprofits must endeavor to advance their missions and strengthen their impact, those who provide financial or other types of support should examine external, independent sources of information, and not as Nardizzi suggests, rely up information exclusively form the

This chart shows that funds from United Way and donated services are the smallest part of revenue received by this organization. Grant funds are more than 25% of the revenue and an important part of the mission. Writing grant proposals and submitting

Has to report fund raising or administrative expenses, meaning the organization cannot claim a zero fund raising expense.

There are three main funding sources other than individual donations that charities receive funding from foundation, corporate, and federal grants. Faith based organizations lose out on federal funding in an article published by CNN. Only $1.17 billion of the 14.5 billion equaling 8% of the funds awarded to social programs went to faith-based initiatives. Most of the money “went to large social service providers that have received the funds for decades” (CNN, 2005).

After answering all of the respected questions thoroughly and to the best of your team’s ability, you will then move forward in transferring the data on the worksheets into the summary of assessment items form. Fisher (2004) states that we take each percentage and multiply that number by the points allowed which gives us our total number for that section. For example, if section 1.1 A totaled fifty percent, we would then multiply that by the total number of points allowed which would be 75. The number of points scored would be 35. We would follow this process for each categorical section. Once this is completed, we tally up all of the combined points. According to Fisher’s assessment criteria, the maximum amount of total possible points is 1000. Fisher (2004) reported that most organizations score between 250 to 375 points. Caravatta (1997) builds upon

The IRC is a section of federal statutory tax law in which income tax and gift taxes, as well as other forms of taxes, are outlined and described in terms of enforcement (Internal Revenue Code). The IRS’s main responsibility includes “exempting nonprofit organization’s from the corporate income tax through verification of the IRC by placing the organization’s into more than 30 classifications that reflect the basis for their tax exemption” (Worth, 24). After being classified as an organization in the nonprofit sector, rather than being in the government or for-profit business sector, the nonprofit sector is then divided into four major categories in which they could be exempt from taxes. These categories include organization’s tax exempt under the 501(c)(3) of the IRC that are public charities, organization’s that are tax exempt under 501(c)(3) that are private foundations, organization’s that are tax exempt under 501(c)(4) of the IRC as social welfare organization’s and “other” organization’s such as social/recreational clubs and labor unions (Worth, 25). Social welfare organization’s are tax exempt under 501(c)(4) of the IRC and are composed of advocacy groups, civic groups and often times HMOs. They can spend money on lobbying without limitation, and typically want to influence legislation in someway. They are tax exempt under 501(c)(4) because they “work to

Financial statistics of the overall organizations will help to compare the statistics of the two specific locations this paper focuses on. According to the Forbes largest U.s Charities list, previously mentioned, The Salvation Army’s overall fundraising is 90% effective whereas Feeding America’s fundraising is reported to be 99% effective. (“The 50 Largest U.S. Charities”, n.d.) A lot of these statistics show that Feeding America has higher percentages in most areas compared to the Salvation Army. This is because, again looking at 2014, The Salvation Army received $344 million from the government because they are a religious organization. (“The 50 Largest U.S. Charities: Salvation Army, n.d.) This also explains why Feeding America has 99% donor dependency rate where the Salvation Army only has a 70% rate. (“The 50 Largest U.S. Charities”,

Donors, whether individual or corporate, are essential to the ongoing vitality of Abbotsford Community Services (ACS). ACS has affirmed the importance of acknowledging donor gifts in its policies and the intent of these guidelines are to outline the ways in which donors of varying levels will be recognized for their support.

One shortfall is the failure to take into consideration what items and services an American family would need in order “to live at a designated level of well-being, together with their estimated monthly or annual costs.” (Fisher, 1992) such as the cost of housing, child care, healthcare, transportation, or geographic location. Healthcare financial managers struggle with implementing charity programs because they have to work with a formula that “has not evolved with the times” and uses pre-tax dollars to within its formula (Receivables Report for America's Health Care Financial Managers,

This is an annual evaluation form. Indicate the rating value for each factor using the following Performance Criteria Rating Scale:

According to Judith Warner, a New York Times journalist who specializes in psychology, the charitable giving deficit is due to the lack of empathy towards the hardships of the poor among their rich counterparts (Warner 2). In light of this, it is important to determine how socioeconomic background influences donation patterns in order to bridge the charitable giving gap.

Government consideration for removal of funders “tax-deductible status” and or limitation on the amount funders can provide. According to Reyes-Fournier, (2014) Not-for-profit “counsel”, administrators conveyed that numerous “federal government” representatives are considering this as a method for resolving the governments’ financial problems. He further mentioned, “This would effectively make donations to a church, school or welfare agency no different than tipping a restaurant server (para 4).” I presume that if this were to be implemented many non-profits would not be able to survive.