By Casey Hale on 11/13/2012 10:01 AM

The Internal Revenue Service recently announced on its website that it mailed a Group Exemptions questionnaire to 2,000 randomly selected central organizations. The Service explains that the questionnaire will help it gather information to better understand how central organizations relate to and report about their subordinate group organizations. Here is a sample of the letter and questionnaire.

There are a couple of interesting aspects to the questionnaire. First, responding to the questionnaire is voluntary. Organizations that receive a questionnaire aren't required to respond to it. Second, a organization may only respond on-line through the Service's website. There's no other method available for an organization to respond to the questionnaire.

As with other compliance checks performed over the past few years by the Exempt Organizations unit, we'll likely see a report at some point based on the data the Service gathers using the questionnaire. Those reports are always informative and interesting and will provide interesting insights into organizations with a group exemption

By David Keligian on 11/9/2012 10:19 AM
The uncertainty about the recent presidential and California elections has vanished and one thing is absolutely clear—taxes are going to be much higher. Unlike the situation two days ago, there is now a very strong possibility that one of the most powerful wealth transfer vehicles will soon be legislated out of existence.

Intentionally defective grantor trusts (or “IDITs”) are among the most powerful estate and gift tax saving strategies in existence. IDITs have been used successfully over the past 20 years. They let you get assets out of your estate, provide asset protection for your children, grandchildren, and great-grandchildren, and allow continuous wealth transfers (by the grantor’s payment of income taxes on the trust’s assets) without further gift taxes. They can be used to pass wealth which will greatly exceed the $1 million gift and estate exemption which will automatically take effect on January 1, 2013.

The problem is that President Obama’s Fiscal Year 2013 revenue proposals included...
By Casey Hale on 11/8/2012 11:03 AM

Interesting article published today in Corporate Counsel about the coming flurry of regulatory activity from the second-term Obama administration - both in terms of new regulations and enforcement - that will impact employers.

The article also discusses how the Department of Labor, which has received much better funding under Obama, will increase its focus on proper employee classification by finally implementing the "right-to-know" rule proposed back in 2010 under the Fair Labor Standards Act ("FLSA"). That rule requires that employers notify workers of their rights under the FLSA and provide certain information regarding hours worked and wage computation. Also, employers will have to perform and document a classification analysis if they wish to classify any worker as an independent contractor.

The take away: Employers "need to be introspective, . . . examine many of their policies and procedures...
By Casey Hale on 11/7/2012 10:54 AM

The Internal Revenue Service announced yesterday that it is expediting review and approval of applications for 501(c)(3) tax-exempt status filed by nonprofit organizations providing relief to the victims of Hurricane Sandy. At the same time, the Service reminded those who want to provide relief to look to existing organizations - including churches - since those organizations can often administer relief programs more efficiently than new organizations as they typically already have fund-raising and distribution infrastructures in place.

By Casey Hale on 11/6/2012 12:08 PM

Both The Huffington Post and ABC News included a story on their websites today about the IRS' suspension of enforcement actions against churches that engage in prohibited political activities.  According the story, the IRS suspended church audit activity back in 2009 and has no plans to resume church audits until the agency goes through a formal rule-making process on the issue.  This is especially interesting given Alliance Defending Freedom's ("ADF") recent promotion of Pulpit Freedom Sunday where...