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Overview of the Nonprofit Legal Landscape

Tax, corporate and trust law ‒ the three underpinnings of nonprofit law ‒ serve to bolster thriving nonprofit sectors in the United States and abroad. In the U.S., nonprofit organizations employ over ten percent of the total workforce and account for over five percent of the nation’s GDP.

  • Tax law provides a double tax benefit: income tax exemption to charitable organizations and tax deductibility of contributions to donors. Double tax benefits also support and encourage a culture of giving in society and across borders. In addition, the U.S. tax code entitles organizations to tax exemption for a highly diverse and broad array of innovative nonprofit purposes and activities.
  • Under the Corporate laws of most states, nonprofit corporations have great flexibility in determining how to govern themselves, generate revenue, and conduct business.
  • Under Trust law, charitable donors, while receiving immediate tax advantage, can direct the use of their gifts for generations into the future ‒ an early and prime example being Benjamin Franklin. In 1789, with great hope for the new republic, Franklin gave £1,000 in trust to Boston and Philadelphia. He instructed that the trusts accumulate interest for 200 years and then be distributed to assist young apprentices and, among other purposes, for “public works which may be judged of most general utility to the inhabitants.”

In return for such tax, corporate, and trust law benefits, organizations commit to serving a public good. To ensure legal compliance, nonprofit organizations are subject to numerous and often complex laws, governmental regulations, funding restrictions, and reporting requirements. They also must comply with employment, contract, banking, and other laws applicable to all businesses.

We help guide clients through these laws, regulatory systems, and organizational challenges. We assist nonprofit and philanthropic organizations of all types, from those intimately involved in pressing local concerns to those providing valued programs and services of broad public benefit, to those tackling vital national and global issues.

Our nonprofit clients bring to us a deep commitment to providing public benefit, or to effectuating social change, financing an innovative cure to a social ill, or realizing a creative or social entrepreneurial ambition. We bring to our clients clear and feasible structures and mechanisms to help them focus efficiently on their vision.


Nonprofit Corporate Law & Governance

  • Formation and incorporation
  • Governance and board structure, composition, roles, and responsibilities
  • Board/staff relationships, responsibilities, and delegation of authority
  • Conflicts of interest
  • Liability, risk management, insurance
  • Attorney General Issues
  • Relationship with fiscal sponsors, chapters, and affiliated organizations
  • Regulatory compliance and annual reporting
  • Corporate practices and recordkeeping
  • Mergers and dissolutions

Tax-Exempt Organization Law & Regulation

  • Counsel to all classifications of 501(c) tax-exempt organizations with emphasis on:
    – 501(c)(2) Corporations holding property for tax-exempt organizations
    – 501(c)(3) Charitable organizations, private foundations, operating foundations, and supporting organizations
    – 501(c)(4) Civic organizations
    – 501(c)(5) Labor organizations
    – 501(c)(6) Professional, business, and trade associations, chambers of commerce
    – 501(c)(7) Social and recreational clubs
    – 501(c)(8), (9), and (10) Employee associations and fraternal organizations
    – 501(c)(12) Mutual or Cooperative Electric Companies
    – 501(c)(14) Credit Unions
  • Obtaining and maintaining tax-exempt status
  • Advocacy, lobbying, and political activities
  • Grantmaking practices
  • Executive compensation
  • Intermediate sanctions
  • Public charity support tests and qualification
  • Private foundation rules and regulations
  • Operating foundation and supporting organization qualification and operating standards
  • Disqualified person and self-dealing rules
  • Commercial and entrepreneurial activities
  • Taxation of unrelated business income
  • Corporate Sponsorships
  • Annual reporting, Forms 990

Charitable Contributions, Trusts & Endowments

  • Charitable gifts, contributions, and deductibility
  • Endowments: creation, use, and management
  • Endowment policies
  • Charitable Trusts
  • Donor gift instruments including restricted and outright gifts, donor advised funds, and board designated funds
  • Modification of charitable trusts (under the doctrine of Cy Pres)

Labor & Employment

  • Employment contracts
  • Executive compensation and contracts
  • Employee termination and severance
  • Independent contractor / employee compliance
  • Employee handbooks and staff policies
  • Employment discrimination
  • Harassment claims
  • Utilizing volunteers and interns
  • ADA and reasonable accommodation laws
  • Wage and hour laws
  • Workplace investigations

Mergers & Nonprofits in Transition

  • Mergers, dissolutions, and asset transfers
  • Restructuring and corporate reorganizations
  • Affiliations, partnerships, strategic alliances, and collaborations
  • Joint venture agreements and joint venture entities
  • Use and role of subsidiaries, controlled organizations, and for-profit entities

Nonprofit Ventures & Social Enterprise

  • Joint ventures and agreements
  • Entrepreneurship and commercial enterprise
  • Mission related investments: Program-related, impact, and socially-responsible investing
  • Alternative business models: Multiple 501(c) entities under a single corporate structure, “B” (benefit) corporations, and integrated for-profit and nonprofit structures

Contracts & Transactions

  • Contracts of all types
  • Leases
  • Management and operating agreements
  • Gift and funding agreements
  • Grant award agreements
  • Cross-border funding arrangements
  • Non-compete and non-solicitation agreements
  • Confidentiality agreements

Nonprofit Intellectual Property

  • Protecting and managing intellectual property:
    – Copyrights, trademarks, names, logos, and patents
    – Research, business methods, work processes, and trade secrets
  • Licensing and royalty agreements
  • Private vs. organizational ownership of intellectual property
  • Confidentiality, non-competition, and non-solicitation agreements