Proposed Free Speech Fairness Act: Will it pass?

A number of nonprofit leaders — BoardSource, the National Council of Nonprofits, Independent Sector, and the Council on Foundations — have voiced opposition to President Trump’s promise to eliminate the Johnson Amendment. The amendment bars tax-exempt charities from using their resources for partisan political purposes.

H.R. 781, the “Free Speech Fairness Act” to appeal the amendment, was introduced in Congress in February and has been assigned to committee. Opponents fear that allowing charities to participate in partisan political activities will make political contributions tax-deductible. Conservative groups that favor greater advocacy in the public space, such as the Alliance Defending Freedom, have long sought repeal of the restriction.

New tool makes it easier to see nonprofit tax records

Charity Navigator recently released a new digital tool for “researchers’, data scientists’ and enthusiasts’” use to explore nonprofits’ public tax records. The Digitized Form 990 Decoder features a database of more than 1.7 million tax records. Of these, more than 900,000 have been processed, ranging from over 33,000 2009 Form 990 filings to nearly 216,000 2014 Form 990 filings.

The project is ongoing and open-source. Charity Navigator, which aims to inform donors in their contribution choices, hopes other developers will design improvements to make the tool even more “robust and comprehensive.” Go to to find the Decoder.

IRS warns about W-2 phishing scheme targeting NFPs

The IRS has issued an urgent alert about a Form W-2 phishing scam that targets nonprofits. According to the agency, cybercriminals send an email that appears as if it’s from an organization executive to an employee in the payroll or HR department requesting a list of all employees and their Forms W-2.

The scam first appeared last year. But now, the fraudster follows up with an “executive email” to the payroll manager or comptroller and asks that a wire transfer be made to a certain account. If you get either of these emails, tell the IRS right away.

FASB issues guidance on partnership consolidation

A recent Financial Accounting Standards Board (FASB) update outlines the rules for when certain nonprofits should consolidate activities of their other partners in financial statements. This continues current guidance that a nonprofit general partner controls the partnership — unless the limited partners have certain rights.

Accounting Standards Update No. 2017-02, Not-for-Profit Entities — Consolidation (Subtopic 958-810): Clarifying When a Not-for-Profit Entity That Is a General Partner or a Limited Partner Should Consolidate a For-Profit Limited Partnership or Similar Entity, takes effect for fiscal years starting after December 15, 2016.

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