Ward and Smith, P.A.'s attorneys provide a full range of legal services to nonprofit organizations, including litigation, taxation, and labor and employment. We have experience representing a diverse group of nonprofit organizations such as public charities, private foundations, social welfare organizations, social clubs, and business leagues. We have developed a specific expertise in addressing issues for Section 501(c)(3) organizations, the most complex and most highly regulated type of tax-exempt organization. Our attorneys assist nonprofit organizations with the choice and formation of the appropriate entity and preparation of organizational documentation such as Articles of Incorporation, Bylaws, and organizational minutes. We are familiar with the specific federal and state requirements that must be met to obtain tax exemption and request recognition of tax-exempt status through applications to the Internal Revenue Service ("IRS") and the North Carolina Department of Revenue. We also assist our nonprofit clients in numerous other organizational matters, such as obtaining property tax exemptions and licenses to solicit charitable contributions in North Carolina.
Once the nonprofit organization is formed and operating, our attorneys continue to work with these organizations to assist them in ensuring that their activities comply with the myriad of restrictions and operational issues which apply to nonprofit organizations, including advising on certain restrictions placed on the organization by the donor; implementing strategies to avoid or minimize unrelated business income tax; advising tax-exempt organizations of the impact their actions may have on their tax-exempt status, which can be lost if the organization acts inappropriately; and advising on the numerous reporting requirements to the IRS and to donors as well as on the rules regarding public disclosure of certain of the organization's documents. Our attorneys interact with boards of directors of client nonprofit corporations to ensure that appropriate procedures are taken at the board level to approve actions undertaken by the corporation and to ensure that the directors are meeting their fiduciary obligations to the organization.
Our attorneys also can assist nonprofit organizations with the special termination rules and procedures that apply to organizations that are winding up their activities and terminating their operations. In addition, we can assist nonprofit organizations with IRS audits or issues or disputes that may arise between the organization and the IRS.
As part of a full-service law firm, attorneys in the Nonprofit Organizations Practice Group draw on the experience of attorneys in other practice groups within the Firm to ensure that our clients' needs are met. In one such case, Nonprofit Organizations and Real Estate Practice Group attorneys worked together on a bargain sale of real estate. A corporation wanted to liquidate its assets and make a charitable contribution to our nonprofit client. We negotiated and structured a bargain sale of real estate from the corporate donor to our client to the satisfaction of both parties.
Nonprofit organizations often face the same legal issues as for-profit organizations, complicated by special tax rules and governmental regulations. Nonprofit law is heavily tax driven and tax law is an area that is constantly changing. The attorneys in the Nonprofit Organizations Practice Group keep up to date on tax developments and monitor tax legislation in order to keep our nonprofit clients informed of the potential impact of key developments through newsletters, special bulletins, and seminars.
The Nonprofit Organizations Practice Group understands the challenges facing our clients and can offer the guidance clients need to comply with federal and state rules and regulations. Attorneys in this Practice Group advise clients in the following matters:
- Formation, merger, acquisition, and liquidation of nonprofit organizations;
- Corporate governance and tax compliance matters;
- Planning for charitable giving;
- Formation of taxable and tax-exempt subsidiaries;
- Section 457(f) deferred compensation plans;
- Structuring joint ventures with for-profit entities;
- Analysis of private inurement and excess benefit transactions;
- Unrelated business income;
- Choice-of-entity analysis; and
- Interpretation and application of tax legislation.
Our attorneys bring to their work a range of complementary experience including the following: authors and lecturers on estate and tax planning issues and the operation of nonprofit organizations; certified public accountants; and members of boards of local chapters of nonprofit organizations.
Our attorneys belong to many organizations relating to their practice areas and are members of numerous professional organizations that provide resources for them, such as the Tax Section of the North Carolina Bar Association and the American Bar Association; East Carolina Estate Planning Council; and North Carolina Association of Certified Public Accountants.