Misclassification of employees as independent contractors is found in an increasing number of workplaces in the United States, in part reflecting larger restructuring of business organizations. When employers improperly classify employees as independent contractors, the employees may not receive important workplace protections such as the minimum wage, overtime compensation, unemployment insurance, and workers’ compensation. (U.S. Department of Labor)
Employer's Supplemental Tax Guide (Publication 15-A) offers guidance on classification of employees, compensation, tax withholding, and related matters. (IRS)
Classifying Employees Correctly as either an independent contractor or employee and then as an exempt or non-exempt employee is critical for avoiding costly legal fees, penalties, and back owed overtime wages plus back taxes. (National Council of Nonprofits)
Employee Classification Conundrum offers a step-by-step assessment to help determine whether an employee should be classified as exempt versus non-exempt under the Department of Labor's Fair Labor Standards Act. (Nonprofit Risk Management Center)
Have a burning advocacy-related question? Bolder Advocacy offers an "Ask an Expert" service, where you can submit your question and get help from their advocacy coaches. (Alliance for Justice)
Federal tax laws allow for all charitable nonprofits to engage in legislative lobbying "as long as that activity amounts to only an 'insubstantial' amount of the nonprofit's activities." Learn how to take the 501(h) election and advocate for your cause with legislators while still maintaining your organization's tax exempt status. (National Council of Nonprofits)
Your organization might be wondering how to get involved in elections. It's important to understand what types of election-related activities you can and can't do, as detailed in this excerpt Common Ground.
© North Carolina Center for Nonprofit Organizations, Inc. From Common Ground, a publication of the N.C. Center for Nonprofits
All 501(c)(3) organizations must file Form 1023 to apply for recognition of exemption from federal income tax. Please see the following IRS online resources:
About Form 1023 Instructions for Form 1023 Form 1023 (Dec 2017 version)
Nonprofits must establish that the executive compensation (salary and benefits for senior level personnel) provided at their organization is "reasonable and not excessive." The IRS recommends a three step process referred to as "rebuttable presumption" to substantiate the reasonableness of compensation offered by an organization and provides legal guidelines:
Learn about parties able to take legal action against your organization, and about Directors' and Officers' (D&O) liability insurance, in: Who Can Sue a Nonprofit Board? (Nonprofit Risk Management Center)