Charity begins with good planning.
Nonprofit organizations generally fall into one of two categories: family foundations and broadly based, publicly supported organizations, including donor advised funds and community foundations. Our attorneys are well versed in these types of nonprofits and support our clients in the following areas:
- Formation. We advise new nonprofits on a spectrum of legal and tax issues such as choice of entity, formation and governing documents. We also assist nonprofit clients in applying for tax-exempt status with the IRS and registering with the state to ensure that they will be recognized as charities.
- Governance and compliance. We assist nonprofits with fundamental governance and operational issues, such as compliance with federal and state laws, including tax laws. The tax deductibility of donations, for example, is a fast-evolving area, and nonprofits, as well as the donors who support them, need to ensure that contributions to the charity will be deductible. Strict adherence to the tax laws is critical in order to avoid the imposition of a variety of excise taxes.
- Termination. If it is necessary to wind down a nonprofit organization, careful planning is crucial, as the stakes can be high: terminations are subject to significant oversight and penalties for failing to strictly adhere to the governing documents and applicable laws can be costly.
We also assist in setting up specialized kinds of charitable split-interest trusts, such as charitable lead trusts (CLTs) and charitable remainder trusts (CRTs), which are principally estate planning tools for our clients who are charitably inclined.