The Law of Fundraising. Bruce R. Hopkins

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СКАЧАТЬ annual report is due at varying times as required by the states' charitable solicitation statutes. The filing may have to be made within 30 days after the close of the accounting period, within 60 days of that period, within 75 days of the period, within 90 days of the period, within five months of the period, or within six months of the period. The regulators in a few states are authorized by statute to require the filing of a report, in some instances in addition to an annual report, by a charitable organization with respect to some other period.

      In some states, the annual report filing requirement, or the extent of it, depends on the level of annual contributions received and/or use of a professional fundraiser and/or professional solicitor. In a few states, a registration or other authorization may be canceled or not renewed until the required annual report is filed.

      The annual report of a parent charitable organization must include information with respect to all of its fundraising affiliated groups.

      A few states provide, by statute, the fee to be paid with the filing of an annual report. In other states, any fees of this nature are set administratively.

      Occasionally, a charitable organization soliciting contributions in a state is required to file financial reports on a quarterly basis during its first year of existence.

There often are separate reporting requirements for professional fundraisers and professional solicitors.⁴⁶

§ 3.5 EXEMPTIONS

Most of the states' charitable solicitation acts provide some form of exemption from their requirements; however, these laws vary widely with respect to the exemptions available for organizations and solicitations. As noted, the basic definition of the term charitable is sufficiently broad to initially encompass all categories of charitable and other organizations. Therefore, these laws are applicable to soliciting religious, educational, health care, and other charitable organizations, unless an exemption is expressly available to them.

These statutory exemptions may be available for an organization because of the nature of the entity or for an organization to the extent it engages in a particular type of solicitation. The exemption may be from the entirety of the statute or merely a portion of it. In some states, an exemption is not effective until the organization applies for it and is recognized by the state to have it.⁴⁷

(a) Churches

Churches and their closely related entities are often exempted from the entirety of the states' charitable solicitation acts.⁴⁸ A typical state's statute accords total exemption to any church or convention or association of churches, primarily operated for nonsecular purposes and no part of the net income of which inures to the direct benefit of any individual.

      In many of these states this exemption is not found within the portion of the statute providing for exemptions but instead is located in the definition of charitable entities.

Some states' charitable solicitation laws grant this exemption only to churches and like organizations that have been classified as such by the IRS. These organizations, however, are not required to obtain recognition of tax-exempt status⁴⁹ and thus some of them do not have this type of classification; technically, then, these organizations are not eligible for the exemption.

(b) Other Religious Organizations

Many states provide an exemption for religious organizations in general from the totality of their charitable solicitation acts. A state law may exclude a corporation sole or other religious corporation, trust or organization incorporated or established for a religious purpose, any agency or organization incorporated or established for charitable, hospital, or educational purposes and engaging in effectuating one or more of such purposes, that is affiliated with, operated by, or supervised or controlled by a corporation sole or other religious corporation, trust or organization incorporated or established for religious purposes, and other religious agencies or organizations that serve religion by the preservation of religious rights and freedom from persecution or prejudice or fostering religion, including the moral and ethical aspects of a particular religious faith.

      It is less common for an exemption for religious organizations to be confined to the registration or other requirements as to preapproval. Some states provide religious organizations with exemption from their registration (and sometimes reporting) or like requirements.

(c) Educational Institutions

      Some states exempt at least certain types of educational institutions (often with emphasis on higher education) from the entirety of their charitable solicitation acts. Usually, this exemption applies only where the institution is accredited. The more common practice is to exempt educational institutions from only the registration or other preapproval (and sometimes reporting) requirements.

      States may, either as an alternative to or in addition to the foregoing approach, exempt from the registration and reporting requirements educational institutions that confine their solicitations to their “constituency.” Thus, a state's law may provide an exemption from registration for any other educational institution confining its solicitation of contributions to its student body, alumni, faculty and trustees, and their families.

      On occasion, a state may exempt solicitations by educational institutions of their constituency from the entirety of their charitable solicitation laws.

Many schools, colleges, and universities undertake their fundraising by means of related “foundations.”⁵⁰ Several states expressly provide exemption, in tandem with whatever exemption their laws extend to educational institutions, to these supporting foundations. Some states exempt, from the registration requirements, parent–teacher associations affiliated with an educational institution, alumni organizations, and student groups.

(d) Libraries

Some states exempt nonprofit libraries from the registration and reporting requirements of their charitable solicitation acts.

      Where a state charitable solicitation act fails to make an express provision for exemption for libraries, these institutions may be able to secure an exemption as educational institutions.

(e) Museums

      Rarely does a state exempt nonprofit museums from the registration requirements of their charitable solicitation act.

      A museum may be able to acquire exemption from a state's charitable solicitation act as an educational institution, where express provision has not been made for it in the exemption clauses.

(f) Health Care Institutions

      Some states exempt nonprofit hospitals from the registration or reporting requirements of their charitable solicitation acts. A state may similarly exempt foundations that are related to and supportive of hospitals.

      A few states exempt nonprofit hospitals from the entirety of their charitable solicitation acts. A state may similarly exempt hospital-related foundations.

(g) Other СКАЧАТЬ