June 2019


June, 2019




The Attorney General has filed a lawsuit against an organization whose principal program service is to provide medical supplies overseas.  The suit alleges in part that there are misrepresentations as a result of the over-evaluation of the gifts in kind.  The suit continues to take the position of the Attorney General that the evaluation of donated pharmaceutical goods should be based upon the value at the place of receipt rather than the domestic cost. 

Source:  Los Angeles Times, May 30, 2019.



A private individual in the state of Florida incorporated a nonprofit, WeBuildTheWall Inc.,” which allegedly raised more the $23 million based upon the solicitation of raising funds to build the President’s wall to stop illegal immigration.  As a result of complaints, the Florida Department of Agriculture and Consumers Services has launched an investigation that includes possible assertions of filing false financial statements and failure to comply with the charitable solicitation law in the state. 

Source:  AlterNet.org, June 10, 2019



The Mississippi Telephone Solicitation Act has been amended by Senate Bill 2821.  The amendments expand the coverage of the “do-not-call” provisions of the Act.  Previously, calls made by bona fide employees of charitable organizations were exempt from the “do-no-call” provisions.  This law changes that so that the only exemption that may be available is for unpaid volunteers calling on behalf of charitable organizations.  (Commentary: Our review of the Act with the change leads us to question the constitutionality of this new restriction.)


New Hampshire

The NonProfit Times reported on June 24, 2019, that the Department of Justice Charitable Trust Unit issued a report tying financial issues at two nonprofits to the suicide of the executive in charge of both organizations.  The two organizations were CareGivers, Inc., and Danny’s Team.  In the case, the executive officer controlled all of the mail and opened the mail and allegedly used significant sums of monies donated to the charities for personal purposes.

Source:  The NonProfit Times, June 24, 2019



The Attorney General’s office has entered into a settlement whereby the Koda Bear Foundation will be dissolved after paying restitution of $2,000 and an $8,000 civil fine. The chief executive officer agrees to never again incorporate a nonprofit in Ohio.  The investigation alleged that the executive director used charitable funds for personal purchases.

Source:  Toledo Blade, June 14, 2019



House Bill 4345 provides civil immunity to charitable organizations and their employees or volunteers for good-faith disclosure to an individual’s current or prospective employer of information about past sexual misconduct allegations.  The disclosure must be reasonable in order to obtain the immunity.

Source:  TNPA Legislative Report, May 30, 2019



The Office of the Attorney General has sent a number of letters to charities seeking information about solicitation activities conducted in the State.


U.S. Congress

On June 18, 2019, the Nonprofit Relief Act of 2019 was introduced in Congress to repeal provisions of the 2017 tax law.  In addition to extending the paid leave tax credit to tax-exempt organizations, the legislation also makes any mileage reimbursements paid by nonprofits to volunteers nontaxable up to 58 cents mile.  The Act also repeals Section 512(a)(6) of the Internal Revenue Code that prevents nonprofits from aggregating profits and losses of unrelated businesses.  Unfortunately, the legislation does not address the unrelated business income tax on the provision of certain employee fringe benefits.

Source:  The NonProfit Times, June 19, 2019


Action in Congress

The Taxpayer First Act (HR-3151) has been passed which will require the electronic filing of nonprofit returns and the release of those forms to the public for no cost.  The data will be in a format that is described as searchable and machine-readable. 


Charitable Giving Report

CNBC reported on January 18 that Americans gave $427.71 billion to charity in 2018.  The report produced by Giving USA, when adjusted for inflation, reported an actual decline of 1.7%.  The CNBA report speculates whether the new tax law, which eliminated or reduced the benefits of charitable giving for many would-be donors, was the cause.