The IRS has an oversight role regarding charitable organizations- nonprofit organizations with tax-exempt status. Accordingly, we consistently remind founders and directors of nonprofits: not only do you have to work to obtain tax-exempt status, but you also must work to KEEP it.
One of the major components to ensuring you do not jeopardize your status is a SOLID conflict of interest policy- not only having the policy but FOLLOWING it. A conflict of interest policy is necessary to help ensure that when actual or potential conflicts of interest arise, there is a process in place that requires individuals to make the board fully aware of all relevant facts. It is also designed to create procedures by which individuals with a conflict of interest are excused from voting concerning that matter.
A conflict of interest can arise in a variety of different scenarios but in most cases rears its ugly head when it comes to any sort of compensation or benefits for directors, officers or trustees. Remember- you cannot serve your PRIVATE interests when they conflict with your PUBLIC purpose! Do not jeopardize your status! Give us a call to assist you TODAY!
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