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V July/August wa Philanthropy Journal of North Carolina Connections Going online Computer bulletin board The Council on Foundations in Washington wants to create a national computer bulletin board ^tem for grantmakcrs. A demonstration model of the system, which is stiQ in the initial planning stages, was on display at the council’s annual conference in New York City in April. The bulletin board will be a central “online meeting place” for foundation staff and other grant- makers. Members will tap into a host computer using a personal computer and modem. The system will offer grant- makers the chance to share infor mation, collaborate on projects, inform or query colleagues on issues of mutual interest and con duct informal polls - among other things. Staff members at the Council say they will not be ready to unveil the new system until late sununer or early fail. In the meantime, here are some national computer resources the council has compiled; Technito! Development Corporation Nonprofit Computer Connection 30 federal Street Boston, MA 02110 " 1617)728-9151: :.^ - , : Computer Help and Information Center Center for Nonprofit Manogement/ Southern California 315 West 9tli Street, Suite 1100 los Angeles,® 90015 {213)623-7080 Society for Nonprofit Organizations Information Systems Support Program 63140danaRoaiSaiteT Modison,Wl 53719 (800)424-7367 t:. Nonprofit Computer Exchange Fund for the City of New York 121 Sixth Ave.,6ihfio0F 4" MewYotk, NY 10013 1212)925-5101 Steven Shafer CompuMentor Pittsburgh 209bndonTowiieftive Pittsburgh, PA 15226 (412)268-2527 Philanthropy Journal of North Carolina A PUBLICATION OF The News and Observer Foundation 215 S. McDowell St. Raleigh, NC 27601 (919) 829-8988 VoL. 1 No. 11 SUBSCRIPTION PRICES 1 year 2 years 3 years $57 $104 $143 Multiple-copy discounts avaii- abie. Caii (919) 829-8991 for rates. DIDN’T RECEIVE YOUR NEWSPAPER? If you happen to miss your newspaper, call (919) 829-4763. Faithful supporters North Carolina religious charities see a rise in giving As part of a series of stories on giving trends, the Philan thropy Journal looked at giving to religious organiza tions in North Carolina. Many congregations have seen an increase in donations, with local needs taking precedence over support for national and international charities. By Barbara Solow 46% G iving to religion remains one of the most popular choices for donor dollars in North Carolina and the U.S. The annual “Giving USA” survey by the American Association of Fund Raising Counsel shows giving to U.S. religious organizations rose by 4 percent in 1993 to $57.15 bil lion. The survey says that giving to religious charities rose even while membership in some denomina tions declined. One reason is that donors see religious organizations as a place to address educational, social service and cultural needs, as well as spiritual ones. Religious leaders in North Caro lina attribute giving increases to a host of factors, including improved fundraising strategies and growing membership. 134% NORTH CAROLINA VS. NATIONAL GIVING PATTERNS Percent of donor dollars North Carolina VH Notional 14% Education Hospitals Sociol and Services Health Care Source: NC Gtying (1991 figures) ^ S%i Religion 3%i 5% 3% Arts Environment Other and Humonities TEN LARGEST SINGLE GRANTS TO NC REUGtOUS INSTITUTIONS Recipient Founclntion United Methodist uiutth Chartotte Jewish Fedeiotton NC Conference of the United Methodist Oiwth Fiist fiesbytetioB Clutch ofMoxton Opeiation Ixodds ; ■ Myets Park Baptist Qiutch BayleatChuich Source: NC Otving (1991 tinufos} Duke Endowment Biumenthat Fctundafion Duke Endowment Aimeno Cume SMotoliti Purcell Mctaitfoundntion Kaplan Fomliyftundoiion C.O. Sponglei foundation Polin f oundotiofl 5444,602 290,000 268,077 *209,958 200,000 ■ 100,000 . 63,975 While more money is coming in, many congregations have noticed that fewer funds are available for national or international religious charities. That’s a pattern that Bill Tie- mann has noticed in his role as associate director for church devel opment for the 43,000-member Charlotte Presbytery of the Presbyterian Church, USA. Although giving to Presbyterian churches in the Charlotte area increased slightly last year, less money was earmarked for overseas missions, hospitals and schools. “More and more churches are keeping money for themselves and not giving to mission causes out side their local church,” Tiemann says. “From the Baby Boomers on down to Generation X, it’s a group of people who mostly didn’t grow up in that church or denomination. So you have less loyalty to long term denominational causes such as world missions.” The Presbytery used to support 500 missionaries and numerous overseas hospitals and schools, Tiemann says. The number of mis sionaries now has fallen to 300, and many of the international institu tions have been closed because of lack of support. A dispute over the status of the Cooperative Baptist Fellowship, which sends money to church mis sions in the U.S. and overseas, erupted at the 137th annual meet ing of Southern Baptists last month in Orlando, Fla. By a close vote, the delegates voted to reject the funds, which conservatives claimed siphoned off money from the main denomina tion. In response to increased compe- Look for GIVING page 21 Keeping close watch ms targets nonprofit activities, organizations Colleges, museums and social clubs are among the nonprofits whose income-generating activi ties are coming in for closer scrutiny by the Internal Revenue Service. By Marguerite LeBlanc “T”he Internal Revenue Service I is paying closer attention to / certain income-generating activities of nonprofits and to specif ic types of tax-exempt organiza tions. The government initiative is aimed at cracking down on abuses of tax-exempt status. The income-generating activities targeted for enforcement by the IRS are debt financed income, advertis ing, mailing lists, insurance pro grams, travel tours and corporate sponsorship fees. The targeted orga nizations are colleges and universi ties, hospitals, museums, business leagues, social clubs and veterans’ organizations. With corporate giving down, interest rates at a 30-year low and dwindling government funding, many nonprofits find themselves increasingly dependent upon other sources of income. But without knowledge of rules regarding cer tain types of income-generating activities, some nonprofits may unwittin^y find themselves with an unexpected tax bill. Current rules regarding the tax status of “unrelated business tax able income” date to the Revenue Act of 1950, which was passed in response to Congressional concerns TAXES about reported abuses - specificaOy, ownership of companies by colleges and universities. The law was enact ed to reduce unfair competition that might result from the advantage gained when a tax-exempt organiza tion engaged in activities similar to those of for-profit companies. The issue of IRS rules on taxable income for nonprofits was among the topics discussed at a recent con ference sponsored by the North Carolina Association of CPAs. The program drew 140 participants - double that of last year’s session. In one workshop, Rebecca J. Whitener, director of internal audit at the University of North Carolina at Charlotte, said that strategies can be adopted to minimize unrelated business taxes, an area in which IRS enforcement was lax until the late 1980s. Two areas in which nonprofits can run into trouble, she said, are mailing lists and affinity cards, such as credit cards or phone cards that bear the name or logo of an organi zation. A nonprofit working with a third-party vendor to market an affinity card to its constituents must carefully structure agreements spelling out royalties to the nonprof it, and must consider how actively involved the nonprofit’s staff will become in marketing the card in order to avoid triggering unplanned taxes. The more visible and active the nonprofit’s role, the more likely it is that the nonprofit will incur taxes based on income generated by the card. The sale of mailing Usts is anoth er area in which nonprofits may unintentionally generate income subject to unrelated business taxes. In general, nonprofits may sell lists to other nonprofits without having to pay taxes on income from the sale, but taxes may result from the sale of lists to organizations that are not tax-exempt, depending on what other services are involved. Sales of mailing lists as part either of an insurance or affinity card marketing program can result in taxable income. For information, call the N.C. Association of Certified Public Accountants at (919) 469-1040. Public access Nonprofits get new accounting standards The Financial Accounting Standards Board has re leased two new statements that affect the way nonprofits prepare their financial state ments. The changes are aimed at making the informa tion more accessible to the public. By Marguerite LeBlanc "jHie way nonprofits account I for contributions and pre- / pare their financial state ments change soon, thanks to two new statements from the Financial Accounting Standards Board (FASB). The changes take effect for financial statements prepared for fiscal years beginning after Dec. 15, 1994. Nonprofits with assets of less REGULATION than $5 million and annual expens es of less than $1 million have a one-year extension on implementa tion. By standardizing the financial statements of all nonprofits, FASB aims to reduce inconsistent report ing and accounting practices among nonprofits. The board also hopes to make the statements more useful to the public and poten tial donors by making them easier to read and compare, Such stan dardization already exists for state ments from for-profit coiporations. The Standards Board is an industry group that establishes standards Mowed by accountants. Look for ACCOUNT, page 5
Philanthropy Journal of North Carolina (Raleigh, N.C.)
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July 1, 1994, edition 1
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