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The Law of Fundraising, 5th Edition

The Law of Fundraising, 5th Edition

Bruce R. Hopkins

ISBN: 978-1-118-65064-6

Oct 2013

640 pages

$240.99

Description

Raising funds to fulfill a nonprofit organization's goals is critical to its success, but fundraising regulations are an increasingly complex maze. The Law of Fundraising, Fifth Edition is the definitive guide to demystifying federal and state fundraising regulations. With new discussion on Internet fundraising, political fundraising laws, and international fundraising, this book details federal and state laws, with an emphasis on administrative, tax, and constitutional laws. This guide is supplemented annually to keep nonprofit professionals on top of the latest fundraising legal developments.

Preface xi

1 Government Regulation of Fundraising for Charity 1

§ 1.1 Charitable Sector and American Political Philosophy 2

§ 1.2 Charitable Fundraising: A Portrait 9

§ 1.3 Evolution of Government Regulation of Fundraising 10

§ 1.4 Contemporary Regulatory Climate 16

2 Anatomy of Charitable Fundraising 21

§ 2.1 Scope of Term Charitable Organization 22

§ 2.2 Methods of Fundraising 25

§ 2.3 Role of Fundraising Professional 36

§ 2.4 Role of Accountant 40

§ 2.5 Role of Lawyer 42

§ 2.6 Viewpoint of Regulators 43

§ 2.7 Viewpoint of a Regulated Professional 44

§ 2.8 Coping with Regulation: A System for the Fundraising Charity 46

3 States’ Charitable Solicitation Acts 49

§ 3.1 Summary 50

§ 3.2 Definitions 50

§ 3.3 Preapproval 60

§ 3.4 Annual Reporting 64

§ 3.5 Exemptions 65

§ 3.6 Regulation of Professional Fundraisers 72

§ 3.7 Regulation of Professional Solicitors 73

§ 3.8 Regulation of Commercial Coventurers 73

§ 3.9 Limitations on Fundraising Costs 74

§ 3.10 Availability of Records 76

§ 3.11 Contracts 77

§ 3.12 Registered Agent Requirements 78

§ 3.13 Prohibited Acts 78

§ 3.14 Regulatory Prohibitions 80

§ 3.15 Disclosure Statements and Legends 80

§ 3.16 Reciprocal Agreements 81

§ 3.17 Solicitation Notice Requirements 82

§ 3.18 Fiduciary Relationships 83

§ 3.19 Powers of Attorney General 83

§ 3.20 Miscellaneous Provisions 84

§ 3.21 Sanctions 85

§ 3.22 Unified Registration 85

§ 3.23 Other Laws 86

§ 3.24 Prospect of Law Changes 88

4 State Regulation of Fundraising 91

§ 4.1 Regulation of Fundraising Costs 92

§ 4.2 Police Power 114

§ 4.3 Fundraising as Free Speech 120

§ 4.4 Due Process Rights 164

§ 4.5 Equal Protection Rights 166

§ 4.6 Delegation of Legislative Authority 170

§ 4.7 Treatment of Religious Organizations 175

§ 4.8 Other Constitutional Law Issues 186

§ 4.9 Exemption for Membership Groups 187

§ 4.10 Defining Professional Fundraiser and Professional Solicitor 189

§ 4.11 Direct-Mail Fundraising Guidelines 191

§ 4.12 Registration Fees 195

§ 4.13 Fundraising Over Internet 198

§ 4.14 Conclusions 210

5 Federal Regulation of Fundraising 211

§ 5.1 Federal Regulation of Fundraising: How It All Began 213

§ 5.2 Fundraising Disclosure by Charitable Organizations 221

§ 5.3 Charitable Gift Substantiation Requirements 225

§ 5.4 Quid Pro Quo Contribution Rules 233

§ 5.5 Fundraising Disclosure by Noncharitable Organizations 237

§ 5.6 Intermediate Sanctions 241

§ 5.7 Unrelated Business Rules 252

§ 5.8 Exemption Application Process 293

§ 5.9 Reporting Requirements 301

§ 5.10 Lobbying Restrictions 301

§ 5.11 Public Charity Classifications 305

§ 5.12 School Record-Retention Requirements 311

§ 5.13 Fundraising Compensation Arrangements 313

§ 5.14 Charitable Deduction Rules 320

§ 5.15 Commensurate Test 346

§ 5.16 Special Events and Corporate Sponsorships 352

§ 5.17 Appraisers and Penalties 356

§ 5.18 Postal Laws 358

§ 5.19 Antitrust Laws 371

§ 5.20 Securities Laws 372

§ 5.21 FTC Telemarketing Rules 375

§ 5.22 Internet Communications 381

§ 5.23 Health Insurance Portability and Accountability Act Regulations 387

§ 5.24 IRS Examination Guidelines 388

§ 5.25 Political Campaign Financing 392

6 Import of Form 990 423

§ 6.1 Form 990 Series Basics 424

§ 6.2 IRS Guiding Principles 428

§ 6.3 Import of Form 990 429

§ 6.4 Summary of Parts of Form 990 429

§ 6.5 Preparation of Form 990, Part I 433

§ 6.6 Summary of Form 990 Schedules 435

§ 6.7 Form 990-EZ 439

§ 6.8 Transition Rules 439

§ 6.9 Instructions 439

§ 6.10 Federal and State Regulation of Gaming 440

§ 6.11 Schedule B 444

§ 6.12 Preparation of Form 990 Schedule G 446

§ 6.13 Preparation of Other Parts of Form 990 453

§ 6.14 Preparation of Form 990 Schedule M 456

§ 6.15 Annual Filing Requirement and Tax-Exempt Status 463

7 Prospective Federal Regulation of Fundraising: Proposals and Issues 465

§ 7.1 Introduction 466

§ 7.2 Major Legislative Proposals 468

§ 7.3 Regulatory Issues 474

§ 7.4 Contemporary Developments and Prospects 490

8 Overviews, Perspectives, and Commentaries 497

§ 8.1 Charitable Fundraising and the Law 498

§ 8.2 Defining a Fundraising Professional 511

§ 8.3 Professional Solicitors: Role of Telemarketing 516

§ 8.4 Charitable Sales Promotions 518

§ 8.5 Regulation Unlimited: Prohibited Acts 524

§ 8.6 Fundraiser’s Contract 528

§ 8.7 A Model Law 534

§ 8.8 Charity Auctions 540

§ 8.9 Court Opinion Concerning Sliding-Scale Registration Fees 547

§ 8.10 Charitable Solicitations and the Internet 550

§ 8.11 Charitable Solicitations and Fraud 551

§ 8.12 Charitable Solicitations and Substantiation 554

§ 8.13 Some Proposals for Relief 559

§ 8.14 A Look Ahead 562

9 Standards Enforcement by Watchdog Agencies 565

§ 9.1 Nongovernmental Regulation 565

§ 9.2 Role of an Independent Monitoring Organization 567

§ 9.3 Standards Applied by Watchdog Agencies 571

§ 9.4 Philanthropic Advisory Service Standards 572

§ 9.5 BBB Wise Giving Alliance Standards 575

§ 9.6 Evangelical Council for Financial Accountability Standards 575

§ 9.7 Standards for Excellence Institute Standards 577

§ 9.8 Panel on Nonprofit Sector Fundraising Principles 579

§ 9.9 American Institute of Philanthropy Standards 581

§ 9.10 Standards Enforcement 584

§ 9.11 Watchdog Agencies and Litigation 587

§ 9.12 Commentary 589

§ 9.13 A Watchdog Agency’s Response to Commentary 595

§ 9.14 Reply to Response 597

§ 9.15 Rating the Raters 599

About the Authors 603

About the Companion Website 605

Index 607