Welcome to your daily briefing on nonprofit developments in Delaware. Today we're covering 6 key stories including updates on delaware nonprofit headlines, background & context. Let's dive in.
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The IRS has published Delaware-specific filing information for tax-exempt organizations.
Delaware nonprofit professionals can access state-specific guidance to ensure accurate and timely compliance with federal requirements.
The IRS has released data from millions of nonprofit tax filings since 2013, and ProPublica's searchable database lets users find organizations and view executive compensation, revenue, expenses, and tax filings dating back to 2001.
Delaware nonprofit professionals can benchmark their own organizations against peer nonprofits in the state and verify competitive compensation and financial practices.
Delaware First Health and the Centene Foundation have launched an open submission period for community-based organizations and providers across Delaware to apply for grant funding through June 13, 2025.
This creates a timely funding opportunity for Delaware nonprofit professionals serving local communities, with applications due next month.
Reach professionals in this market
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The streamlined Form 1023-EZ is available only to organizations meeting specific limits on projected revenue, assets, and activity types. Filing 1023-EZ when ineligible produces a determination that is technically valid but vulnerable to retroactive revocation if discovered. The full 1023 is harder to file but harder to challenge.
Loss of exemption is retroactive to the original determination, exposing the organization to back-tax liability. The eligibility checklist is the only protection.
Donor-restricted gifts must be tracked separately and used only for the restricted purpose; using them for general operations — even with intent to "pay back" later — is a fiduciary breach and an audit finding. The most-common fact pattern: cash-flow shortage in operations, restricted-grant balance available, transfer "borrowed" with no formal repayment plan.
State attorneys general have authority over restricted-gift compliance and have pursued individual board members and executives. Auditors are required to disclose restricted-fund violations in the management letter.
Unrelated business income tax applies when an activity is regularly carried on, is a trade or business, and is not substantially related to the exempt purpose. Common surprises: corporate-sponsored events with naming rights that look like advertising, affinity credit-card royalties that include co-marketing services, and gift-shop sales of items unrelated to the mission.
UBIT exposure can cost both tax and exempt status if the unrelated business becomes substantial. The line between sponsorship (excluded) and advertising (included) is narrow and case-specific.
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