Public Confidence in Nonprofits Varies
A survey conducted by the Chronicle of Philanthropy — the first to measure public confidence in charities since 2008 — has found that two-thirds of Americans have a fair amount of confidence in charities. More than 80% indicated that charities do a “very good” or “somewhat good” job helping people.
A significant number of respondents, however, expressed concerns about charities’ money management. One-third said charities do a “not too good” or “not at all good” job spending money wisely, and 41% said their leaders are paid too much. Notably, half said that, when deciding where to donate, it’s “very important” to know that charities spend a low amount on salaries, administration and fundraising. And 34% said such knowledge is “somewhat important.”
Consider these statistics when you complete your next Form 990 or draft your next annual report. Are you clear about how you help your constituents while you manage your nonprofit’s money wisely?
Pro Bono Marketing Marathons Offered to Charities
Nonprofits in need of help with their advertising, marketing and communications work may have a new resource. CreateAthon, a nonprofit based in Richmond, Va., recruits creative professionals and students in the communicating arts to serve nonprofits using a 24-hour marathon format called CreateAthon Events.
Each event rallies teams of 20 to 240 “creatives” to deliver the pro bono services needed by up to 12 nonprofits to fulfill their missions. Nonprofits interested in participating apply to the companies and colleges that host the events three to four months beforehand. CreateAthon hopes to deliver $100 million in free marketing services to charities by 2020.
The IRS Definition of “Interested Persons”
Nonprofits who file Schedule L, “Transactions with Interested Persons,” with Form 990 or 990-EZ should pay attention to the definition of “interested person.” With 2015 being only the second year that the IRS’s new approach to the definition of “interested persons” applies, nonprofits may still harbor some confusion about the changes.
Previously, each part of the schedule had its own definition of the term. The Part I definition hasn’t changed — an “interested person” is still a disqualified person under Section 4958, the provision addressing the tax on excess benefit transactions.
The definition for Parts II-IV now includes the organization’s founder and his or her family members; substantial contributors and their family members; and 35% controlled entities of creators, founders, substantial contributors or any of their family members.
For more information on how your organization should report transactions on Schedule L, contact your CPA.