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Posted by removeps-groups@yahoo.com on June 18, 2008, 1:07 pm
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> > I mean, if say, a volunteer with an eligible youth group incurred
> > expenses to take the members on an appropriate outing, that would
> > be a deductible expense, even if the youth group organization
> > itself didn't directly benefit. But the outing would be
> > furthering the purpose of the organization, right?
>
> That's not a benefit to the organization but doing something on
> behalf of the organization that is within its exempt purpose. If it
> looks like the trip is done primarily for the benefit of the kids and
> primarily to satisfy its exempt purpose, it may well be ok. But if
> it looks like an excuse to take a vacation, the IRS will deny it.
In any case, when you donate to a regular 501(c)(3), part of that
money may be diverted to non-exempt organizations. For example, part
of your $100 donation to Red Cross would be used to buy gasoline for
their cars, part for office furniture from a for profit store, part
for a CPA, etc. Yet the $100 donation is allowed in full.
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Posted by Stuart Bronstein on June 18, 2008, 1:38 pm
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> In any case, when you donate to a regular 501(c)(3), part of that
> money may be diverted to non-exempt organizations. For example,
> part of your $100 donation to Red Cross would be used to buy
> gasoline for their cars, part for office furniture from a for
> profit store, part for a CPA, etc. Yet the $100 donation is
> allowed in full.
It is all supposed to go to support the exempt function. If you need a
CPA to comply with GAAP or tax laws, if you need furniture for the
nonprofit to function, if you need to buy gas so you can drive
somewhere to perform the exempt function, all those support the
organization's function and are permitted. If some of it is paid to
someone's child as a bribe to make sure his homework is done, that's
not within its exempt purpose, and the person causing that to happen
could be required to pay the money back.
Stu
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<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
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Posted by dpb on June 18, 2008, 3:43 pm
Please log in for more thread options removeps-groups@yahoo.com wrote:
...
> In any case, when you donate to a regular 501(c)(3), part of that
> money may be diverted to non-exempt organizations. For example, part
> of your $100 donation to Red Cross would be used to buy gasoline for
> their cars, part for office furniture from a for profit store, part
> for a CPA, etc. Yet the $100 donation is allowed in full.
That is not "diverted", that's simply paying expenses of operating the
organization (and is fully qualified as long as they are using the
vehicles or obtaining the services in support of their mission).
"Diversion" would be sending chunks of contributions to individual(s) or
other organizations for their own use in ways that do not further the
direct objectives of the 501(c)(3). Folks get in trouble for this all
the time, particularly those who set up "charities" specifically w/ the
intent of skirting the rules so as to actually be profit-makers for
themselves (the scam of individual churches is a prime example).
--
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<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>
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Posted by Dick Adams on June 19, 2008, 12:07 pm
Please log in for more thread options > removeps-groups@yahoo.com wrote:
>...
>> In any case, when you donate to a regular 501(c)(3), part of that
>> money may be diverted to non-exempt organizations. For example, part
>> of your $100 donation to Red Cross would be used to buy gasoline for
>> their cars, part for office furniture from a for profit store, part
>> for a CPA, etc. Yet the $100 donation is allowed in full.
> That is not "diverted", that's simply paying expenses of operating
> the organization (and is fully qualified as long as they are using
> the vehicles or obtaining the services in support of their mission).
Perhaps he should have written "part of that money may be
paid to non-exempt organizations" for operating expenses
which is exactly your point.
In the context of this thread, the issue is whether or not
the ultimate recipient of cash and/or out-of-pocket costs
of rendering services needs to be an exempt organization.
Dick
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<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>
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Posted by Stuart Bronstein on June 19, 2008, 12:25 pm
Please log in for more thread options rdadams@panix.com (Dick Adams) wrote:
>
>> That is not "diverted", that's simply paying expenses of
>> operating the organization (and is fully qualified as long as
>> they are using the vehicles or obtaining the services in support
>> of their mission).
>
> Perhaps he should have written "part of that money may be
> paid to non-exempt organizations" for operating expenses
> which is exactly your point.
>
> In the context of this thread, the issue is whether or not
> the ultimate recipient of cash and/or out-of-pocket costs
> of rendering services needs to be an exempt organization.
The answer is clearly no. Charitible organizations receive money
because they need it to perform their exempt functions. That means
paying for things to those who are not themselves exempt (including
employees).
In this context the services need only benefit the exempt organization
in some substantial way, and not be primarily for the donor's own
personal benefit.
Stu
--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>
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