Welcome to your daily briefing on nonprofit developments in South Carolina. Today we're covering 5 key stories including updates on south carolina nonprofit headlines, background & context. Let's dive in.
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The South Carolina Association of Counties provides a resource page for officials and employees to search for grant funding and low-interest loans.
Nonprofit professionals in SC can use this directory to identify potential funding sources and direct inquiries to the appropriate agencies.
The Central Carolina Community Foundation is mobilizing charitable giving to help build a stronger community through its available grants and scholarships.
Nonprofit professionals in SC can explore these resources to identify potential funding streams and opportunities to support local community initiatives.
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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.
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.
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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