Friday, May 18, 2012
Read the latest updates below or with full articles online.
ACR Blog Roundup
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The ACR blog (www.acreform.com/blog) highlights our thoughts on news of the day. For regular blog updates, follow us @acrefom on Twitter.
This week we have a special blog post from an ACR event held last week on transparency. This will be the first of what we hope will be many posts on the many facets of transparency:
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What is Transparency and What Does it Mean for Philanthropic Organizations?
This was the topic of a lively roundtable event co-hosted last week by The Philanthropy Roundtable and the Aspen Institute. The panel featured experts from different areas of the nonprofit sector to bring a broad perspective to the discussion. The Philanthropy Roundtable will be publishing a new short book on transparency in the nonprofit sector this summer and this event served as a preview into the ideas in the book. Check out video and read more about the event on the ACR blog.
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Washington Roundup
Ways and Means Hearing on Nonprofits
On Wednesday, May 16th, the House Ways and Means Oversight Subcommittee held a hearing on compliance and regulation issues for tax exempt organizations, with a specific focus on public charities. Committee Members asked the witnesses to comment on reporting mechanisms (Form 990) and other regulatory issues, pressing them on ways in which the current system can be improved.
In addition to tax practitioners and compliance officers, the committee members heard from Roger Colinvaux, a former top aide at the Joint Committee on Taxation. Colinvaux helped advise Congress on some of the sweeping proposals for nonprofits included in the Pension Protection Act (PPA) of 2006. Commenting on the PPA),... (Continue reading)
Process for Tax Reform
During a speech at a Washington, DC fiscal summit on Tuesday, May 15th, House Speaker John Boehner (R-OH) confirmed that the House of Representatives will hold votes on extending the Bush-era tax cuts before the election in November to clear the decks to "give Congress time to work on broad-based tax reform that lowers rates for individuals and businesses while closing deductions, credits, and special carve-outs.” The Speaker went on to say
that the House will also put forth legislation to establish an expedited process by which Congress could enact tax reform in 2013... (Continue reading)
Consider This
The Debt Ceiling, It’s Back…
It’s starting to look like déjà vu all over again.
We all remember the high-stakes game over raising the debt ceiling last summer. “Not pretty” is the best way to describe that exercise.
And now, we may be headed toward debt ceiling debate 2.0...(Continue reading)
Making Headlines
Tax Reform
Hearing: On May 16, the Oversight Subcommittee of the House Ways and Means Committee held a hearing on tax issues affecting nonprofit organizations. Resources: Read all of the submitted testimony here and view the entire video of the proceeding here. Also see:
Nonprofit Sector’s Big (Often Feared) Question Briefly Arises at House Hearing, Nonprofit Quarterly, and IRS Urged to Reduce Paperwork Burden on Charities, Chronicle of Philanthropy.
Federal
Program-Related Investments: As we reported, the IRS recently proposed a rule (REG-144267-11) that would allow private foundations to participate in more types of program-related investments (PRIs) without triggering excise tax. The White House Office of Social Innovation is touting
PRIs an innovative way for foundations to use their assets to promote social good.
States/Local
Philadelphia: Recently, the Pennsylvania Supreme Court issued a ruling that may open the door for local taxing authorities to challenge the exemptions of Pennsylvania charities. In that decision, the Court ruled to qualify for property tax exemption. an organization must: “(a) advance a charitable purpose; (b) donate or render gratuitously a substantial portion of its services; (c) benefit a substantial and indefinite class of persons who are legitimate subjects of charity; (d) relieve the government of some of its burden; and (e) operates entirely free from private profit motive.”
Ruling: Mesivtah Eitz Chaim of Bobov, Inc v. Pike County Board of Assessment Appeals. Also see: Pennsylvania Supreme Court Case May Open Door to Tax Exemption Challenges, Nonprofit Law Professors Blog
In related news, we continue to see municipalities placing pressure on large nonprofits, particularly colleges and universities, to pay property taxes or payments in lieu of taxes (PILOTs).
Hawaii: As we’ve reported, a bill has been moving
through the Hawaii legislature which would repeal a cap on tax exemptions for certain taxpayers. In a recent op-ed, Lowell Kalapa, president of the Hawaii Tax Foundation, voices the concerns of Hawaiian charitable organizations that the limitation on itemized deductions would decrease giving.
Transparency -- NEW
State-funded Organizations: A bill (SB 3773) advancing through the Illinois State Senate, would require nonprofits that receive state funding to post their performance evaluations of the state-funded projects on the
Illinois Transparency and Accountability Portal, the state’s database of state expenditures and contracts. Some consider these efforts duplicative to IRS information collection.
Challenges of Mandates: An editorial in the Helena Independent Record outlines the difficulties of increased transparency mandates for nonprofit organizations, finding that the IRS already requires a good amount of disclosure.
Research (Studies & Reports)
Community Foundations: A recent study by the Council on Foundations and the CFInsights finds that grantmaking by community foundations has grown by an average of 7% and their assets have grown by 8% since 2010. See report: Columbus Survey 2011, Guideposts for Navigating Peaks and Valleys.
This Caught Our Eye…
Funding America’s History: The Washington Post profiles philanthropist David Rubenstein who rose from humble beginnings to become a prominent supporter of national historical monuments and treasures such as the National Monument and National Zoo and essential national documents such as the Magna Carta and the Emancipation Proclamation. See our past coverage of Rubenstein here.
Arab American Philanthropy: The Nonprofit Quarterly interviews the head of the Center for Arab American Philanthropy about its approach to building Arab American nonprofits.
Cause-related Marketing: Philanthropy Daily reviews a new book, Compassion, Inc: How Corporate America Blurs the Line between What We Buy, Who We Are, and Those We Help, which discusses the benefits and challenges associated with “cause-related marketing” for nonprofit organizations and philanthropy. Also see: Cause Marketing and Ethical Branding, NPR.
West Virginia Non-Profit Association: West Virginia Grantmakers and the West Virginia Community Development Hub have joined together to create the region’s first nonprofit association which will strengthen philanthropy in West Virginia and focus on training and public policy.
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