Chapter 13

Question 1

Private foundation

Answer 1

An organization exempt from federal income taxes under IRC Sec. 501(a) that (1) receives its support from a small number of individuals or corporations and investment income rather than from the public at large and (2) exists to make grants to public charities.

Question 2

Public charity

Answer 2

An organization exempt from taxes under IRC Sec. 501(a) that receives its support from the public at large rather than from a limited number of donors. Most often public charities are exempt from federal income taxes under IRC Sec. 501(c)(3).

Question 3

By laws

Answer 3

private/rules and regulation of governance

Question 4

List some regulations over NFO

Answer 4

Application to operate under an assumed name
Application to incorporate as a NFO or LLC
Annual compliance testing

Question 5

Does the state recognize you as NFP or Federal

Answer 5

NFP

Question 6

T/F does NFP have to pay employment taxes

Answer 6

Yes

Question 7

How is the Public support test met:

Answer 7

is met if NFP receives 1/3 of its total support from investments, contributions made directly or indirectly by the general public or some combination

Question 8

Not for profit organization

Answer 8

are defined as entities who serve a purpose other than to provide goods or services at a profit, do not have owners and rely on contributed resources.

Question 9

Charitable solicitation

Answer 9

Indirect or direct request for money, credit, property, financial assistance or other items of value on the representation that these assets will be used for a charitable purpose.

Question 10

What taxes are NFP’s exempt from?

Answer 10

sales tax, real or personal property, transfer, employment, or excise tax.

Question 11

Influencing

Answer 11

promote, support, affect, modify, oppose or delay

Question 12

Organizational test

Answer 12

articles of incorporation limit the organizations purpose to those described in IRC Sec 501 and do not empower it to engage in activities that are not in furtherance of those purposes.

Question 13

Quid pro quo

Answer 13

contribution made in exchange for goods and services

Question 14

Federated fund raising organization

Answer 14

an organization composed of independent charitable organizations that have voluntarily joined together to raise and distribute money among themselves.

Question 15

What amount is the individual contribution limited to:

Answer 15

only the amount up to 2 percent of the total support can be counted toward public support (numerator)

Question 16

Political organizations

Answer 16

are political action committees, political parties, and campaign committees for candidates for government office.

Question 17

Propaganda

Answer 17

information that is skewed toward a particular belief with a tendency to have little or no factual basis.

Question 18

Legislation

Answer 18

establishes laws, statutes and ordinances

Question 19

What is the primary tool that the federal government uses to collect information about the NFP and its activities.

Answer 19

Form 990

Question 20

Unrelated business income

Answer 20

which assesses tax at corporate rates on income that NFPs derive from activities not substantially related to their charitable or tax-exempt mission.

Question 21

feeder organization

Answer 21

formed to carry on a trade or business for the benefit of an exempt organization and remits its profits to the exempt organization.

Question 22

grass roots lobbying

Answer 22

an appeal to the general public to contact legislators or to take other action regarding a legislative matter.