The NonProfit Times - February 1, 2009 - (Page 6) RESPONSIBILITIES Continued from page 1 nect between perception and reality.” The reality is that charity regulators started 2009 with a full workload, everything from potential fraud to questions and concerns about the new federal Form 990 filings. There’s plenty of regulatory work without urban legends of a nonprofit financial haven. And while nonprofits often talk about their ratings on charity watchdog Web sites, like the BBB Wise Giving Alliance, Charity Navigator or GuideStar, the state and federal regulators wield the power to legally pursue offending nonprofits. The National Association of State Charity Officials (NASCO) does not aggregate national statistics on complaints filed with members, but some state charity regulators are reporting increased complaints. The Georgia Office of Secretary of State, Securities and Business Regulation Division, reported 34 complaints in 2008, a 44 percent decrease from the 61 complaints made in 2007.While Georgia saw a decrease, Florida Department of Agriculture & Consumer Services, Consumer Affairs division had more than a 26 percent increase – from 147 complaints in 2007 to 186 complaints in 2008. The Ohio attorney general’s office had 1,325 complaints in 2008, a more than 5 percent increase from 2007, but not all the logged complaints fit under the office’s jurisdiction. The Colorado Secretary of State reported 28 complaints against charities in 2008, resulting in two prosecutions, one from the Boulder district attorney and the other by the Colorado attorney general, and seven still under investigation. Chris Cash, NASCO president and Colorado Department of State charities program manager, explained that state charity officials realize that nonprofits tend to receive a small amount of consumer complaints, and disgruntled former employees or volunteers file some complaints.“We investigate all complaints, but not all complaints require agency action beyond a simple inquiry to verify facts,”he said about the Colorado program. The retooled Form 990 adds an extra punch to the charity regulator arsenal. It includes questions about policies regarding governance, management and disclosure, which some regulators are hoping will give more insight to a nonprofit’s operations. The Internal Revenue Service (IRS) worked with NASCO to develop the new Form 990 and received feedback from the organization before releasing the draft to the public in June 2007. “It’s a big interest to the sector because, of course, it’s new and it’s much bigger and broader in scope so that presents challenges to them on how they are going to fill that out,” said Tracy McCurdy, director of the Pennsylvania Bureau of Charitable Organizations. “I think it presents challenges to the accounting professionals because they have to have a higher level of expertise to work on these things. But it’s also really great for the regulators because the IRS has given us a lot with the governance questions and some of the other things, they have really allowed the states to have to play a bigger role in the information that comes out of the 990s.” Overall, the Form 900 is going to provide state charity regulators with a lot more information, “particularly in the areas of governance and also compensation issues because although the states and the IRS have two different jurisdictions, many of the things that we are looking at are important to the states for different reasons because of their areas of charitable oversight,” said Lois G. Lerner, director of the Exempt Organizations (EO) Division of the IRS.“When you look at the facts we look at to determine whether an organization meets the requirements for tax-exemption, those same facts can also give rise to some of the violations at the state level.” Lerner explained that the IRS expected to have regular interaction with NASCO about the new filing and monitor trends that arise with the new Form 990 and hoped the feedback would help shape future adjustments.The IRS and state regulators already have a compliance relationship -- the IRS can give some information to state regulators about enforcement activities under the Pension Protection Act of 2006, while the state regulators can lead the IRS to potential tax violations. In 2008, EO disclosed nearly 200 ‘‘ We often find nonprofit organizations don’t want to call the regulator because they are afraid that the regulator will then take action against their organization, and in our case nothing could be further from the truth. We try to be as proactive as possible and deal with things before they become a real problem. --Terry Knowles 6 FEBRUARY 1, 2009 THE NONPROFIT TIMES www.nptimes.com http://www.mitchstuart.com/destinations http://www.mitchstuart.com/destinations http://www.nptimes.com
Table of Contents Feed for the Digital Edition of The NonProfit Times - February 1, 2009 The NonProfit Times - February 1, 2009 Attorneys General Focusing On Fiduciary Responsibilities The Urge To Merge Taking Cancer To Court Contents Indefensible Calendar Special Report The Holidays Are Over Health Care Guide NPT Jobs Advertiser Index Resource Directory The NonProfit Times - February 1, 2009 The NonProfit Times - February 1, 2009 - Taking Cancer To Court (Page 1) The NonProfit Times - February 1, 2009 - Taking Cancer To Court (Page 2) The NonProfit Times - February 1, 2009 - Contents (Page 3) The NonProfit Times - February 1, 2009 - Contents (Page 4) The NonProfit Times - February 1, 2009 - Contents (Page 5) The NonProfit Times - February 1, 2009 - Contents (Page 6) The NonProfit Times - February 1, 2009 - Contents (Page 7) The NonProfit Times - February 1, 2009 - Contents (Page 8) The NonProfit Times - February 1, 2009 - Contents (Page 9) The NonProfit Times - February 1, 2009 - Calendar (Page 10) The NonProfit Times - February 1, 2009 - Special Report (Page 11) The NonProfit Times - February 1, 2009 - Special Report (Page 12) The NonProfit Times - February 1, 2009 - Special Report (Page 13) The NonProfit Times - February 1, 2009 - Special Report (Page 14) The NonProfit Times - February 1, 2009 - Special Report (Page 15) The NonProfit Times - February 1, 2009 - Special Report (Page 16) The NonProfit Times - February 1, 2009 - The Holidays Are Over (Page 17) The NonProfit Times - February 1, 2009 - The Holidays Are Over (Page 18) The NonProfit Times - February 1, 2009 - NPT Jobs (Page 19) The NonProfit Times - February 1, 2009 - Resource Directory (Page 20) The NonProfit Times - February 1, 2009 - Resource Directory (Page 21) The NonProfit Times - February 1, 2009 - Resource Directory (Page 22) The NonProfit Times - February 1, 2009 - Resource Directory (Page 23) The NonProfit Times - February 1, 2009 - Resource Directory (Page 24)
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