If your group is not registered, any contributions intended for your group are apparently redirected to some other charity.  

PayPal runs a philanthropic website, the “Giving Fund”, which has become a major player in online fund-raising, processing $7.3 billion in contributions last year.

The Giving Fund site lists over one million organizations that can receive gifts. Your favorite charity is probably listed among them. 

But despite promises that 100 percent of donations go to the selected charities, the gifts are delivered only if the groups register accounts on both PayPal and the Giving Fund site, according to a federal class action lawsuit filed in Illinois on February 28, 2017.

Effective immediately, the New York State Attorney General’s Charities Bureau will grant an automatic180 day extension of time to file an Annual Financial Report due pursuant to the Estates, Powers and Trusts Law and/or Article 7-A of the Executive Law. A written request is not required. Registered charitable organizations must file their Form CHAR500 (NYS Annual Filing for Charitable Organizations) and all required attachments and fees within 180 days of the statutory deadline.

See official notice  (pdf)

The NY Attorney General has released an anlaysis of financial reports filed by professional fundraisers for telemarketing campaigns conducted in NY in 2010:

" Last year donors contributed a quarter of a billion dollars to charities through telemarketing campaigns conducted in New York. Yet what many donors may not realize is that only a fraction of the funds raised through telemarketing is typically kept by the charities."

In the Rochester and surrounding region, the AG reports that 37.62% of funds raised actually went to the charities. The rest went to pay the cost of fundraising, including fees to the telemarketer.

(From a speech by Howard Shoenfeld, IRS Special assistant for tax exempt organizations)


1 . Organization fails to consider obvious and subtle unrelated business income tax issues.

2. Organization improperly classifies employees as independent contractors.

3. Organization improperly allocated revenue and expenses between activities or among affiliates.

4. Organization fails to report changes in its operations or activities to the IRS.

5. Organization overlooks IRS conditions in a ruling letter or fails to heed IRS audit changes and cautions.

6. Organization and its related entities deal with each other improperly.

7. Organization files incomplete or inaccurate information and tax returns.

8. Organization fails to maintain adequate books and records.

9. Organization fails to comply with applicable lobbying rules and limitations.

10 Organization fails to follow public inspection and fundraising disclosure requirements.

 

 

The Excess Benefits Tax is designed to penalize those who profit unfairly from their relationship with a nonprofit organization. Many times the tax will be triggered by a transaction the participants thought was perfectly ordinary. Indeed, some transactions that might be ok between an owner and his business, would trigger the tax when they're between a nonproft and a related party.

The best way to understand what the IRS is looking for, is to look at  examples: 

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