Listed below are items that should be considered to comply with the New York Non-Profit Revitalization Act (most provisions became effective on July 1, 2014) and various IRS rules regarding donations and reporting. This list below is not complete:
- The Act (“NPRA”) applies to New York non-profit corporations, charitable trusts, education corporations and religious corporations.
- A written whistleblower policy is required for non-profit corporations and charitable trusts with 20 or more employees and $1 million or more in annual revenue.
- Prior to entering into any related party transaction, the board or any authorized committee of the board must determine in writing that the transaction is fair, reasonable and in the best interest of the entity. The determination should be documented with minutes.
- The entity is required to adopt a written conflict-of-interest policy to insure that its directors or trustees, officers and key employees act in the best interest of the charitable entity.
- Electronic transmission is permitted for board and membership meeting notices and consents in lieu of actions at meetings.
- Quid Pro Quo Contributions: Deductions are limited to the amount donated over the fair value of goods or services provided by the charity as consideration (fund-raising dinners and golf outings). For a single quid pro quo contribution of $75 or more – the charity must provide written disclosure to the donor stating that the deductible amount is limited to the amount paid over the fair market value of the goods or services provided by the charity. The charity must provide a good faith estimate of the fair market value of the goods or services provided. A written disclosure statement must be provided as part of the solicitation.
- If an organization receives property worth over $5,000 as a donation and sells the property within three years, the organization is required to file Form 8282 with the IRS and give a copy to the donor.
- The IRS considers amounts paid for raffles not deductible, even if the taxpayer did not win, because the chance of winning equals the amount paid for the raffle.
If you have any questions, please call Bass & Lemer LLP at 516.485.9600.