Nonprofit Boot Camp

Operating a Faith-Based Nonprofit

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What You'll Learn

Here you will acquire a greater depth of knowledge about legal compliance, including what compliance requirements may apply to your organization. You will also develop the skills to identify your organization’s compliance requirements and to build the organizational tools to keep track of and complete necessary tasks in a timely manner.

Lesson 1

Toward a Spirituality of Compliance

Compliance can often seem tedious, but for a faith-based organization, compliance is an opportunity to offer up inconveniences and serve faithfully in all matters, great and small. An apostolate’s legal and tax compliance demonstrates its love of neighbor. While an apostolate’s noncompliance could harm the organization’s ability to operate or attract donors, the more spiritually significant concern is that such noncompliance could actually rise to the level of scandal, which could distract from – or even prevent – the witness of the apostolate and its staff or volunteers through whatever good work they do. Faithful completion of the most mundane tasks, even legal compliance, is the stuff of saints!

Lesson 2

Voting Requirements: Why They Matter

At first glance, the voting requirements in a nonprofit’s bylaws may not seem an exciting topic. Most nonprofits have not seriously considered their bylaws, perhaps because they have inherited old bylaws, copied the bylaws of another company, or even originated their bylaws from a quick internet search! If any of these scenarios applies to your organization, your organizations’ bylaws may include director voting requirements not tailor-made to your preferences or the specific needs of your organization. Taking just a few minutes to read and think through some key provisions within your bylaws may save you from major issues down the road.

Lesson 3

Voting Requirements: Why They Matter (Video Companion)

This video explains why you need to have carefully crafted language in your bylaws laying out director voting requirements.

Lesson 4

Creating a Compliance Calendar

Using a compliance calendar can minimize the risk of fines and penalties associated with missed or late filings and have a measurable impact on an Organization’s efficient functioning, financial bottom line, and reputation. An effective compliance calendar will identify:(1) key filing obligations, (2) important deadlines, and (3) the individual or parties responsible for preparing and submitting the filings.

Lesson 5

Creating a Compliance Calendar (Video Companion)

This video explains why and how your organization can use a compliance calendar to help you meet crucial deadlines.

Lesson 6

Nonprofit Spring Cleaning: Corporate Records

Complete and well-organized corporate records are important both for efficient organizational performance and for legal compliance. Without up-to-date and organized records, finding the answer to these questions might involve calling retired directors and executives and digging through old computers and archived email inboxes. Too much delay could jeopardize the organization’s ability to respond to funding opportunities and receive applicable exemptions.

Lesson 7

Compliance Alert: IRS Form 990 Filing Deadline Approaches

Most organizations must file the Internal Revenue Service (“IRS”) Form 990 or request an extension by May 15. Many organizations also have state tax filings, charitable registration forms, corporate annual reports, or some combination of these due on the same date.

Lesson 8

Nonprofit State and Federal Filing Requirements: Methods for Compliance, Consequences of Non-Compliance, and Steps for Reinstatement

Is your 501(c)(3) nonprofit complying with its regular filing requirements? Are you incurring penalties for late filing? Has your tax-exempt status been revoked? Read on for an overview of the filing requirements necessary to maintain or regain - a nonprofit’s tax-exempt status under federal law. Below is an overview of best practices for compliance, the consequences of non-compliance, and methods for reinstatement of both state and federal filing requirements if an organization has become non-compliant.

Lesson 9

Introduction to Volunteer Risk Management

‍A strategy for identifying and responding to volunteer risk management issues at Catholic nonprofit organizations. Volunteers are the cornerstone of many Catholic lay apostolates. Often volunteers have as much or more influence and responsibility as full-time employees. Unlike the formal hiring programs used with employees, most volunteer programs are informal, evolving organically according to the organization’s needs. Unfortunately, an approach which is too informal leaves the apostolate and its participants at high risk.

Lesson 10

When to Consider a Third Party Audit

In the same way that some private companies regularly carry out external audits, (audits performed by a third party, not someone affiliated with the company), religious organizations can also carry out external audits. As this post will demonstrate, there are times it may be wise for your organization to do so.

Lesson 11

Conflicts of Interest: Avoiding Common Mistakes

The directors of faith-based nonprofits have a duty of loyalty that requires them to put the organizations’ faith and mission ahead of personal interests, both in fact and in appearance. If the organization plans to enter a conflicted transaction, in which the organization will directly or indirectly compensate a person (such as a director or officer or a company owned by a director) who exercises authority or influence over the organization, special due diligence and approval is necessary. If the board does not conduct the required diligence, state and federal penalties may apply. These penalties include financial penalties, legal actions, and even the voidance of the transaction itself. Not all conflicted transactions are prohibited or improper, but all conflicted transactions must be carefully reviewed.

Lesson 12

Protecting Freedom of Speech Against De-Platforming

Many vendors include provisions in their contracts and user agreements empowering the vendor to unilaterally cut service to faith-based organizations based on subjectively assessed violations of ambiguous hate speech policies. Protect your organization by negotiating for provisions that provide reasonable protection for free speech and religious exercise. This resource gives sample language and a case study of an organization that successfully navigated this challenge.

Lesson 13

Lobbying, Issue Advocacy, and Campaign Activity: Crafting an Organizational Policy

Faith-based nonprofits and their employees, directors, officers, and volunteers often care deeply about political affairs. But there is a well-known tension: faith-based nonprofits with 501(c)(3) status are limited in their ability to advocate for political issues and candidates. This resource explains the basics on lobbying, issue advocacy, and campaign activity for 501(c)(3) organizations and includes a sample policy to protect your organization.

Lesson 14

When the Government Comes Knocking: How Nonprofits Can Prepare for and Respond to Investigations 

How a nonprofit responds to a government inquiry, whether a routine regulatory review or a criminal investigation, can significantly affect its operations, reputation, and ability to raise funds. This guide offers an overview of common government investigations and provides strategies to help organizations navigate the process effectively.

Lesson 15

Five Things to Know About Public Disclosure Requests

As tax-exempt organizations, 501(c)(3) nonprofits are required to make some of their records available for public inspection. Many nonprofit organizations file their IRS Form 990 in May, which means inspection requests often come this time of year from members of the public who want to review an organization’s Form 990.