Nonprofit & Charitable Advisory Services
McGuireWoods’ nonprofit and tax-exempt organizations team provides charitable and other nonprofit organizations with comprehensive advice on organizational, compliance, planning, governance and tax issues. Through our guidance, we help charities and other nonprofits operate successfully in the increasingly complicated, regulated and competitive environment facing such organizations today.
Our services to nonprofit and tax-exempt organization clients encompass a number of areas of law. The types of matters we typically handle for these clients are outlined below.
Governance and Corporate Matters
Our nonprofit team regularly advises nonprofit clients, including public charities, on corporate governance matters. Our team’s work in this area involves updating and revising articles of incorporation and bylaws as well as the development of committee charters and appropriate board policies, such as conflicts of interest, document retention and destruction, and whistleblower policies. The team has worked on governance review and compliance for a variety of nonprofit clients, including private foundations, public university-affiliated foundations, universities, public media organizations, private schools, religious organizations, and other public charities.
McGuireWoods develops corporate governance structures and documents that balance interests of diverse constituents. Additionally, our attorneys help boards of directors understand their unique role in the nonprofit sector and provide counsel on fiduciary duty, conflict of interest policies, privilege and confidentiality, and many more day-to-day issues. In fact, we have extensive experience advising regarding board consideration of non-routine transactions, in conflicts of interest and related party transactions, regulatory matters, new or amended compensation plans, and mergers and affiliations.
We regularly provide advice to nonprofits and tax-exempt organizations on governance and corporate matters, including:
- Drafting, interpreting, and revising organizational documents, including articles of incorporation and bylaws, and policies
- Duties and responsibilities of directors, officers, and committees
- Board training and seminars
- Board disputes
- Best practices, accountability, and transparency
- Conflicts of interest
Tax Advice and Compliance
With a full-service Tax and Employee Benefits Department, which includes a nonprofit and tax-exempt organizations practice group, we are uniquely positioned to provide advice to private foundations and other tax-exempt organizations on the myriad tax laws that affect them and with which they must comply under today’s increasingly complex tax landscape. In addition, we regularly provide in-house training seminars to both counsel and business representatives.
Our nonprofit tax practice includes advice and assistance to clients on matters including:
- Establishment of nonprofit organizations and IRS recognition of exemption
- Initial and annual compliance with federal and applicable state tax laws, including the preparation of annual returns required to be filed with federal and state governments
- Form 990 and Form 990-PF annual reporting
- Tax classification issues, including publicly supported charities and supporting organizations
- Private inurement and private benefit issues
- Excess benefit transactions, including executive compensation
- Unrelated business income tax issues
- Political campaign activities and lobbying
- Joint venture arrangements with both tax-exempt and taxable entities
- Private foundation issues, such as self-dealing, taxable expenditures, excess business holdings, minimum distributions, tax on net investment income and jeopardy investments
- State and local tax issues
- Management of legal compliance audits
- Advice regarding the impact of reforms and legislative changes
- Assistance with tax controversies, audits and litigation
Endowments and Investments
For our nonprofit clients with endowment and other investment assets, we provide advice on a variety of matters and issues, including:
- Management of endowment funds under the Uniform Prudent Management of Institutional Funds Act or its predecessor.
- Investment, securities, and tax law aspects of sophisticated investment vehicles
- Development of investment policies and procedures
- Modification or release of restrictions
- Securities law issues, exemptions, and compliance
- Alternative investment structure, risks, and tax consequences
- Impact and mission-related investment structure, risks, and tax consequences
- Unrelated business income tax treatment of investments and debt-financed property
- Duties regarding restricted and unrestricted endowment funds
- Joint public/private investments.
Fundraising and Development
We work with a number of firm clients on sophisticated development and fundraising programs. Because of our representation of both high-net-worth donors and charitable organizations in connection with charitable giving, we have a unique perspective that allows us to anticipate the needs and issues of donors when advising nonprofit entities. This perspective enables us to work with our charitable organization clients in a manner that enables them to meet donor needs, assist donors with compliance with the tax laws, and successfully complete sophisticated or complex gift transactions.
Our work in this area includes:
- Advice in connection with fundraising and development, planned giving techniques and forms, substantiation of charitable gifts, and income and transfer tax consequences of planned gifts
- Proposals for prospective donors involving complex planned giving transactions
- Implementation of specific planned giving techniques, such as charitable remainder trusts, charitable lead trusts, immediate, deferred and flexible gift annuities, pooled income funds, bargain sales, remainder interests in personal residences and farms, restricted and endowment gifts, and federal and state tax benefits of conservation easements
- Assistance with development of grant-making and scholarship procedures
- Assistance with development of planned giving forms for institutional clients and individuals
- Advice and guidance on administration and tax compliance for charitable lead and remainder trusts, gift annuities and pooled income funds