Photo credit: Boyd A. Loving No injuries following garbage truck crash in Ridgewood May 07,2014 Boyd A. Loving 1:23 PM
Ridgewiid NJ, A Village of Ridgewood sanitation truck collided with a Toyota Camry at the intersection of Prospect Street and Durar Avenue in Ridgewood at approximately 9:00 AM on Wednesday, May 7. No injuries were reported in the crash, either to the three (3) person Village sanitation crew, or to the Camry’s driver. Although the Toyota sustained heavy passenger side damage, it was able to be driven from the scene. The sanitation vehicle was driven back to the Village’s garage for temporary repairs that enabled it to continue on its route. There is a stop sign present at the intersection, but there was no word from police on the scene as to whether any summonses were issued in connection with the crash.
RBSA: How to Lose Your 501(c)(3) Tax Exempt Status (Without Really Trying)
It’s easy for a nonprofit organization to maintain its tax exempt status—and can be just as easy to lose it.
Each year, the IRS revokes the tax-exempt status of more than 100 501(c)(3) organizations. Organizations recognized as exempt from federal income tax under this section of the Internal Revenue Code include private foundations as well as churches, educational institutions, hospitals, and many other types of public charities.
But these organizations can maintain their tax-exempt status if they heed the rules in six areas:
Private benefit/inurement Lobbying Political campaign activity Unrelated business income (UBI) Annual reporting obligation Operation in accord with stated exempt purpose(s)
(Note: The following subjects are described briefly. If you want more information about each area, visit the Tax-Exempt Status Virtual Workshop on the IRS educational micro-site, www.stayexempt.irs.gov.
1. PRIVATE BENEFIT/INUREMENT
Private benefit: “A 501(c)(3) organization’s activities should be directed exclusively toward some exempt purpose,” said Richard Crom, Staff Assistant for IRS Exempt Organizations Customer Education and Outreach office. “Its activities should not serve the private interests, or private benefit, of any individual or organization (other than the 501(c)(3) organization) more than insubstantially. The intent of a 501(c) (3) organization is to ensure it serves a public interest, not a private one.”
Inurement: The concept of inurement states that no part of an organization’s net earnings may inure to the benefit of a private shareholder or individual who, because of the person’s relationship to the organization, has an opportunity to control or influence its activities.
“A 501(c)(3) organization is prohibited from allowing its income or assets to benefit insiders (people with a personal or private interest in the activities of the organization),” said Crom. “Insiders are typically board members, officers, directors, and important employees.” He added that prohibited inurement includes the payment of dividends, the payment of unreasonable compensation to insiders, and the transfer of property to insiders for less than fair market value.
If a 501(c)(3) organization engages in inurement or substantial private benefit, the organization risks losing its exemption. Additionally, insiders guilty of inurement may be subject to excise tax.
2. LOBBYING
When an organization contacts, or urges the public to contact, members or employees of a legislative body for the purpose of proposing, supporting, or opposing legislation, or when the organization advocates the adoption or rejection of legislation, it is lobbying. “501(c)(3) organizations are allowed to do some lobbying,” said Melaney Partner, acting director for the IRS Exempt Organizations Customer Education and Outreach office. “However, if lobbying activities are substantial an organization risks losing its tax exempt status.” She added that an organization can elect to have its lobbying activities measured by an “expenditure test” to determine whether or not the activities are substantial. This is known as a 501(h) election, so-named for the section of the Internal Revenue Code where the rules for the expenditure test are spelled out.
“By making this election, an organization agrees to not spend more than a certain percentage of its total expenses on lobbying activities,” Partner said. “The other way to measure lobbying activity is to determine whether, based on all of the pertinent facts and circumstances, an organization’s lobbying comprises a substantial part of its overall activities. This substantial part test is a more subjective method compared to the more mathematical, objective expenditure test.”
Organizations must file Form 5768, Election/Revocation of Election by an Eligible Sec. 501(c)(3) Organization to Make Expenditures to Influence Legislation, in advance to be subject to the expenditure test.
3. POLITICAL ACTIVITY
All section 501(c)(3) organizations are prohibited from directly or indirectly participating in, or intervening in, any political campaign on behalf of (or in opposition to) any candidate running for public office. The prohibition applies to all campaigns (federal, state and local level). “Political campaign intervention includes any and all activities that favor or oppose one or more candidates for public office,” said Crom, who speaks to non-profit organizations on a regular basis about tax-compliance issues. “The prohibition extends beyond candidate endorsements.”
Contributions to political campaign funds or public statements of position (verbal or written) made by or on behalf of an organization in favor of, or in opposition to, any candidate for public office clearly violate the prohibition on political campaign intervention.
Section 501(c)(3) organizations may engage in some activities to promote voter registration, encourage voter participation, and provide voter education, but they can’t engage in activities that favor or oppose any candidate for public office. Whether an activity is political campaign intervention depends on all the facts and circumstances.
“The political campaign intervention prohibition is not intended to restrict free expression on political matters by leaders of organizations speaking for themselves as individuals,” said Crom. “Nor are leaders prohibited from speaking about important issues of public policy. However, for their organizations to remain tax exempt under section 501(c)(3), leaders cannot make partisan comments in official organization publications or at official functions of the organization.”
4. UNRELATED BUSINESS INCOME (UBI)
Another activity that can potentially jeopardize an organization’s 501(c)(3) tax-exempt status is having too much income generated from activities that are unrelated to the exempt function of the organization. This income comes from a regularly-carried-on trade or business that is not substantially related to the organization’s exempt purpose. “An organization that produces unrelated business income as a result of its unrelated trade or business may have to pay taxes on that income,” said Partner. “Income-producing activity must meet three conditions before the income is potentially taxable.”
First, the activity must be a trade or business. Second, the trade or business must be regularly carried on. Third, the business activity is not substantially related to an organization’s exempt purpose. In other words, the activity itself does not contribute importantly to accomplishing the exempt purpose, other than through the production of funds.
Some of the most common UBI generating activities include: the sale of advertising space in weekly bulletins, magazines, journals or on the organization’s website; the sale of merchandise and publications when those items being sold do not have a substantial relationship to the exempt purpose of the organization; provision of management or other similar services to other organizations; and, even some types of fundraising activities. Generally, organizations that generate unrelated business income should file Form 990-T, Exempt Organization Business Income Tax Return, and pay tax on the income.
“An organization must be careful generating money in activities that do not further its specific exempt purposes,” said Partner. “In addition to the taxability of income from unrelated activities, if those activities are substantial in relation to your exempt purpose activities, you may be putting your exempt status in jeopardy.”
5. ANNUAL REPORTING OBLIGATION
While 501(c)(3) public charities are exempt from Federal income tax, most of these organizations have information reporting obligations under the Internal Revenue Code to ensure they continue to be recognized as tax-exempt. In addition, they may also be liable for unrelated business income tax as described above, employment tax, excise taxes, and certain state and local taxes.
Public charities generally file either Form 990, Return of Organization Exempt from Income Tax, Form 990- EZ, Short Form Return of Organization Exempt from Income Tax, or submit online Form 990-N, Electronic Notice (e-Postcard) for Tax-Exempt Organizations not Required To File Form 990 or 990-EZ.
“The type of form or notice required is generally determined by the public charity’s gross receipts and the value of its assets,” said Crom. For tax years ending on or after December 31, 2010, an organization may file Form 990-EZ if its gross receipts are normally less than $200,000, and if its total assets are less than $500,000 at the end of the year. If the organization’s gross receipts are $200,000 or greater, or if its assets at the end of the tax year are $500,000 or more, the organization generally must file Form 990. If the organization’s annual gross receipts are generally $50,000 or less, the organization may in lieu of Form 990 or 990-EZ submit online new Form 990-N, Electronic Notice (e-Postcard) for Tax-Exempt Organizations not Required to File Form 990 or 990-EZ.
There are some public charities that are not required to file Forms 990 or 990-EZ, including churches and certain church-affiliated organizations. Organizations can learn about filing and new requirements applicable to supporting organizations at the IRS Nonprofits and Charities website.
“The IRS will remove many organizations previously recognized as tax-exempt from its Master File due to provisions of the Pension Protection Act of 2006,” said Crom. “The act requires that all tax-exempt organizations—except churches and church-related organizations—must file an annual return with the IRS. And if they don’t do so for three consecutive years, they automatically lose their exempt status.”
The IRS conducted an extensive outreach effort over the past several years to remind tax-exempt organizations about this new legal requirement — and to file on time. “There were many organizations that we still did not hear from and we will post a list of those revoked organizations on the IRS website in February 2011,” said Crom.
If an organization finds that its exempt status has been automatically revoked due to non-filing and it wants its tax-exempt status reinstated, it will need to reapply and pay the appropriate user fee. For more information on that process, visit the Charities and Non- Profits pages on the IRS website.
6. OPERATION IN ACCORD WITH STATED EXEMPT PURPOSE(S)
“If you stop doing all or a significant amount of the exempt activities you told the IRS you were going to do in your original application for exemption—you could lose your exemption,” said Crom. “If your organization’s direction has changed, let us know. It could prevent future problems.” He added that organizations must adhere to the guidelines inherent in these six areas. “If they do this, they will maintain their tax-exempt status and continue enjoying the benefits associated with it,” said Crom.
To receive periodic updates on current Exempt Organization issues of interest, visit www.irs.gov and sign up to receive the EO Update by e-mail.
Labor Force Participation Rate for 25-29 Year Olds Hits Record Low
May 6, 2014 – 5:18 PM By Ali Meyer
(CNSNews.com) — The labor force participation rate in April 2014 for Americans ages 25 to 29 hit the lowest level recorded since 1982, when the Bureau of Labor Statistics (BLS) started tracking such data.
The labor force participation rate, which is the percentage of the civilian non-institutional population who participated in the labor force by either having a job during the month or actively seeking one, hit a record low in April 2014 of 79.8%.
In January 1982, when the data were first collected, the labor force participation rate for this group was 80.7%.
The actual number of Americans, ages 25 to 29, not participating in the labor force hit a record high in April 2014 as well, with 4,280,000 not working.
Those classified as not in the labor force means that they are included in the civilian non-institutional population but did not have a job, and they did not actively seek one in the last four weeks.
Attkisson Charges ‘Well-Orchestrated Strategy’ Underway to Diminish Benghazi Coverage
Former CBS investigative journalist Sharyl Attkisson had some harsh words to share about the Obama administration and its supporters while she was a guest on Monday morning’s Fox & Friends program.
After viewing some clips from Sunday’s edition of ABC’s This Week With George Stephanopoulos in which conservative pundit Laura Ingraham and Democratic analyst David Plouffe clashed over the death of four Americans in Benghazi on Sept. 11, 2012, Attkisson said she believes that a concerted effort is taking place to divert investigations into that deadly attack, an effort that is being orchestrated by people close to the White House.
U.S. businesses are being destroyed faster than they’re being created
BY CHRISTOPHER INGRAHAM
May 5 at 2:51 pm
The American economy is less entrepreneurial now than at any point in the last three decades. That’s the conclusion of a new study out from the Brookings Institution, which looks at the rates of new business creation and destruction since 1978.
Not only that, but during the most recent three years of the study — 2009, 2010 and 2011 — businesses were collapsing faster than they were being formed, a first. Overall, new businesses creation (measured as the share of all businesses less than one year old) declined by about half from 1978 to 2011.
The Veterans Administration Scandal Hits Home May 5, 2014 By Kay Daly
For anyone laboring under the assumption that the scandal that plagues the VA hospital in Phoenix, Arizona must be anomalous, think again. Without even delving into the medical malpractice testimonials of my three relatives who work at a VA Medical Center on the East coast, the recent near-death experience of my brother confirms our worst fears: the culture of corruption and indifference that afflicts the U.S. Department of Veterans Affairs is systemic.
The horrifying picture my brother cheerfully sent me one afternoon illustrates the story better than any narrative I can tell. It was a “selfie.” An old Army buddy had sent him a pair of sunglasses and my brother suddenly thought he was Joe Cool, happily taking pictures and texting away about his new treasure.
But I wasn’t quite as pleased. Behind the sunglasses was a face that bore so little resemblance to my brother I would not have recognized it had I passed him on the street. Tears streamed down my face as I gazed upon the sunken lines and permanent grimace that now marked a face marred by years of excruciating pain.
Obamacare’s Killer Burden on Nurses Amy Dertz 12:01 AM ET
The Affordable Care Act means more and sicker patients are entering hospitals, and less comprehensive and timely health care.
As the first enrollees in the Affordable Care Act begin seeking care at my hospital, I wonder how my practice as a Registered Nurse will change. We’re told the goal of the new law is to remodel healthcare in the United States into a system that promotes wellness and prevention, rather than just providing care to sick people. This seems like a great objective, but I worry that the switch may compromise the quality of the care our patients receive.
As a bedside RN working at an acute care hospital in Oakland, California, I care for an incredibly diverse patient population. Most of my patients have had health insurance through employer-based programs, private purchase, or Medi-Cal. Most have interacted with the health care system prior to being admitted to my hospital.
Now, I will take care of patients who are new to health care. Some haven’t had care in a long time (or ever). Some may have pre-existing conditions that enabled insurance companies to refuse them coverage. As they enter my care, their needs may be more complicated.
Starting Wednesday, May 7th, paving construction work will begin on the West Side at Wilsey and Garber Squares from Godwin Avenue to under the train trestle on Franklin Avenue. Expect traffic congestion in this area for the next 3 months during construction. To avoid delays, we suggest the use of alternate streets to get across the train tracks – Ackerman Avenue or W. Glen Avenue.
Does a Benghazi Select Committee Matter? Amy Payne May 6, 2014 at 6:30 am
House Republicans are moving to set up a select committee to investigate the Benghazi attacks. The House could vote this week on establishing the panel, which House Speaker John Boehner (R-Ohio) has said would be led by Rep. Trey Gowdy (R-S.C.), a former federal prosecutor.
Helle Dale, a Heritage expert who has followed the Benghazi scandal closely, said this “could be a giant step toward unraveling the real story behind the Benghazi attack, which cost four brave Americans their lives, and the cover-up that has denied Americans the truth.”
>>> See four essential questions the Benghazi select committee should tackle
What is a select committee, and is this move useful? The Foundry asked Heritage legal expert Hans von Spakovsky.
The Foundry: What is a congressional select committee?
Hans von Spakovsky: Select committees can be set up to perform a particular function, often to perform a specific investigation. They are usually created by a resolution that specifies the duties and powers of the select committee, including when its authority will expire. Such committees are particularly useful when jurisdiction over a particular subject is shared by several regular committees, which can lead to confusion and conflicting actions.
Who sets it up, and what jurisdiction/authority does it have?
In this case, Speaker John Boehner has announced his intention to set up the committee and appoint Rep. Trey Gowdy as its head. The House still has to vote to establish the committee. The resolution setting it up (which hasn’t been released yet) will establish its jurisdiction, but in general, select committees can subpoena and depose witnesses, call them to public hearings, and hire lawyers to work as special investigators.
How does a select committee differ from appointing a special counsel to investigate something?
Only the Attorney General can appoint a special counsel to investigate a matter. For example, House Republicans are also talking about asking for a special counsel to look into the IRS’s targeting of conservative nonprofits. The chances of Eric Holder granting that are just about nil.
Does it have the power to punish people?
If, for example, they decided to vote someone in contempt of Congress—for failing to appear or provide testimony—the full House would have to approve that. If Congress had to enforce a contempt citation in federal court, a judge could order the witness who is in contempt to provide testimony, and if the witness doesn’t, the judge could impose jail time or a civil fine. You know, it probably hasn’t been done since the 1800s, but the House does have the power to seize someone who is in contempt of the House. The sergeant-at-arms can seize someone and put them in a jail cell in the House.
What kind of results have select committees produced in the past?
One of the most well-known select committees was the Church Committee chaired by Senator Frank Church (D-Idaho) in 1975 that investigated intelligence gathering by the CIA, NSA and FBI. Its findings led to new laws imposing restrictions on how we gather intelligence, which some believe are at least partly responsible for the intelligence failures related to the attacks on Sept. 11, 2001.
So are select committees focused on producing new laws?
On Benghazi, I think this committee would be driving toward finding out exactly what happened; why the security of the consulate in Benghazi was so inadequate; what failures there were at the State Department and potentially the Pentagon for not being able to respond once the attack started; and coming up with recommendations to prevent anything like this from happening again. In addition to legislative recommendations, they could make recommendations for disciplining or terminating employees if they find wrongful behavior.
It’s been some time since the Benghazi attack on Sept. 11, 2012. Is it helpful to start the investigation now?
A select committee would not have to start from scratch; it would have the benefit of all of the information uncovered to date by the committees in the House of Representatives that have been investigating these matters. But this committee would have the advantage of a single-minded focus on the issue—including dedicated staff—as compared to the regular House committees that have numerous other responsibilities and duties in many different areas.
I had thought this would have happened sooner, but thank goodness it’s finally happening.
Is this just for show, or will it have substance to it?
I think it will have substance to it. And it’s important because four Americans were killed, and it looks like they were needlessly killed—that if the right security steps were taken, they would not have died. I think this is very important for the future safety of American diplomatic personnel.
The state Senate’s Economic Growth Committee today approved a bill intended to make New Jersey more attractive to film and video production companies by expanding a tax credit program.
The bill (S1952) would remove a $10 million limit on incentives for film production, as well as a $5 million incentive cap on digital production.
The advance of the legislation by a vote of 4-0 comes less than a week after industry insiders, speaking on a panel at the Montclair Film Festival, said New Jersey is losing its appeal as a filming location because it is not offering competitive incentives.
Christine Peluso, an attorney with Tax Credits LLC – which helps studios secure tax credits – told lawmakers that incentives were her clients’ “number one consideration” when considering shooting locations.
“In order to attract filming, you have to have an incentive,” Peluso said.
New York, by contrast, offers $420 million a year in credits. (Friedman/Star-Ledger)
Aid Payments Due to Schools May Bear Brunt of State Budget Crunch
With the state facing an $800 million shortfall in its fiscal 2014 budget, there are only so many places that the money can be found to close the gap — and state aid to schools is among the most obvious.
After all, state education aid makes up more than one-third of the overall budget, totaling more than $12.8 billion.
But in a sometimes testy hearing before the Assembly budget committee yesterday, acting Education Commissioner David Hespe offered few clues about whether the answer might simply be delaying school-aid payment until the next fiscal year or eliminating the aid payments outright — or something in between.
“At this point in time, I cannot say what the impact will be, although we can certainly assume given that school funding, both direct and indirect payments, makes up a third of the budget, we can certainly assume there will be some impact,” Hespe said in response to repeated questioning that opened the hearing.
“I just cannot say what that is,” he said. “The goal would be to limit impact to as little as possible. . . . At this point in time, everything is on the table, and I don’t have the ability to take anything off the table.”
State Assemblyman Gary Schaer (D-Passaic), chairman of the budget committee, prodded Hespe further, sometimes sounding like a lawyer in cross-examination.
“Forgive me, I don’t mean to put you on the spot, and I understand the governor will do what he believes what he needs to do to have the less disastrous effects,” Schaer said. (Mooney/NJSpotlight)
Ridgewood Student Honored for Exemplary Essay by US Capitol Historical Society
US Capitol Historical Society Awards Seung Ho Lee Third Place In 2013 ‘Making Democracy Work’ Student-Essay Contest
May 5, 2014
WASHINGTON, May 5, 2014 /PRNewswire/ — The United States Capitol Historical Society is pleased to announce that Mr. Seung Ho Lee, an eleventh-grade student at Ridgewood High School in Ridgewood, NJ has been named one of the winners of the 2013 Making Democracy Work Student Essay Contest. Mr. Lee was awarded Third Place in the Senior Division and earned a cash prize of$250.
“The US Capitol Historical Society is pleased to recognize Seung Ho Lee for his exemplary essay,” said US Capitol Historical Society President Ron Sarasin. “As with all the winning essays, Seung’s essay reflected a deep understanding of the rights and responsibilities of citizens in our representative form of government.”
Mr. Lee’s award-winning essay, “Civic Virtues of Rights and Responsibilities,” reminds us that “with each right we have, we have a corresponding responsibility to protect it.”
“Citizenship itself,” Seung observes, “is not merely a legal status, but a ‘way of life,’ requiring the commitment to active participation in public affairs. . . . As far as his rights permit him, the citizen must teach and foster the civic virtue to respect and advance the freedom of the individuals in a sense of communal identity.”
In recognizing Mr. Lee’s award, Congressman Scott Garrett (NJ-5) said, “I commend Seung Ho Lee on his award-winning essay, ‘Civic Virtues of Rights and Responsibilities.’ It’s great to see young Americans like Mr. Lee active and involved in civics. I hope he continues to reflect on the rights and responsibilities he has, and I wish him all the best in his future studies.”
The 2013 Making Democracy Work Student Essay Contest was made possible by a generous grant from Express Scripts. The 2013 contest is the second in the US Capitol Historical Society’s Making Democracy Work program that has drawn hundreds of entries from students in grades 6-8 and 9-12.
Reader says I moved here because it’s safe and has a great school system
ridgewood’s median income is roughly 3Xs (that’s 300% again for the mathematically challenged) the national average and we only pay 29% more on services. what’s the original poster’s argument? we should pay less for teachers? i don’t think so…i moved here because it’s safe and has a great school system…so far i have been pleased on both fronts and happy to pay for it (even if i have to pay more)
i live the same distance from the firehouse (in ridgewood) as the people whose house just burned down (in midland park). My son choked on an apple a few years ago, they were there in 2 minutes. The house burns in midland park and that firehouse doesn’t get called for 15 mins because the midland park fire chief wanted his volunteer force to run it…i’ll take our current services, thank you very much
stop complaining about paying more for better service and please keep using inaccurate data to make your argument
