Council of New Jersey Grantmakers.
Harnessing Philanthropy's Potential.
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Welcome to your daily briefing on nonprofit developments in New Jersey. Today we're covering 6 key stories including updates on new jersey nonprofit headlines, background & context. Let's dive in.
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Harnessing Philanthropy's Potential.
Relevant to nonprofit professionals operating in NJ.
At the Community Foundation of New Jersey, we create connections.
Relevant to nonprofit professionals operating in NJ.
We are pleased to share grant opportunities for area nonprofit organizations. This list will be updated as opportunities open and close.
Relevant to nonprofit professionals operating in NJ.
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3 stories
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.
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.
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.
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