Welcome to your daily briefing on nonprofit developments in Maryland. Today we're covering 5 key stories including updates on maryland nonprofit headlines, background & context. Let's dive in.
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Governor Moore announced more than $19 million in funding for communities in the second year of Maryland's ENOUGH Initiative.
Nonprofit professionals in MD may find partnership or contracting opportunities with funded community programs, or align their services with initiative goals.
The Maryland Secretary of State has published an official website for state charity information and resources.
Nonprofit professionals in MD can access official state guidance on charity registration, compliance, and regulatory requirements from this authoritative source.
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Most states require charities soliciting donations from their residents to register before solicitation, regardless of where the charity is based. "Solicitation" includes web fundraising pages accessible to residents, not just direct mail. Compliance gaps surface during state attorney-general inquiries or unrelated litigation discovery.
Penalties range from civil fines to suspension of solicitation rights in the state. Larger consequences include negative coverage in donor research databases that fund foundation grants.
The IRS-recommended COI policy requires (1) annual disclosure by all directors and key employees, (2) a process for review of any disclosed conflict, (3) recusal procedures, and (4) documentation in board minutes. Policies that have only the disclosure form without the review and recusal process do not satisfy the recommendation.
A weak COI policy is a Schedule L disclosure waiting to happen, and Schedule L disclosures correlate with future IRS examination selection.
Private inurement is benefit flowing to insiders (officers, directors, key employees); it is an absolute prohibition. Private benefit is benefit to outsiders that is more than incidental to the exempt purpose; it is a question of degree. Both can revoke exemption, but the legal analysis differs.
Insider transactions trigger automatic intermediate sanctions even when the exemption survives. Outsider benefit triggers a facts-and-circumstances analysis. Distinguishing them shapes the defense.
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