Hunton Andrews Kurth LLP counsels a diverse group of tax-exempt and nonprofit clients, including universities and schools; hospitals and healthcare organizations; social service organizations, research institutions and other charities; family trusts; private foundations; trade associations; and lobbying organizations. We also represent individuals in their roles as officers and directors of, and contributors to, tax-exempt organizations.
We have formed numerous new public charities, private foundations, charter schools, business leagues, employee benefit trusts and other exempt entities and have guided them through the process of obtaining IRS and state recognition of their tax-exempt status.
Congress, the IRS and state attorneys general closely scrutinize the operations of exempt organizations and their transactions with officers, directors and substantial contributors. We regularly counsel exempt clients on:
We offer a comprehensive array of tax services to exempt organizations. We also provide a full range of other legal services tailored to our nonprofit clients. Tax-exempt organizations consult us about commercial and tax-exempt bond financing, real estate, litigation, labor and employment (including various issues relating to volunteers and interns), corporate, antitrust, intellectual property, data privacy and other issues. This combination of technical tax knowledge and broad-based support in non-tax areas is essential in the complex – and sometimes hostile – legal environment in which today's exempt organizations must operate.
In reorganizing tax-exempt corporations and forming joint ventures with other exempt entities and for-profit investors, we regularly deal with a broad range of issues, including:
We have formed and obtained IRS approval for exempt and taxable affiliates of major hospitals, educational institutions, preservation groups, trade associations and other tax-exempt clients.
Joint venture arrangements have included both general and limited partnerships, limited liability companies, Delaware series limited liability companies, participating loans, donor-advised funds, fiscal sponsorship agreements and program-related investments.
We assist with international matters, including:
State and local tax issues are of increasing concern to exempt organizations. We advise clients on the full spectrum of state and local legal issues, including:
We advise exempt clients about the permissible scope of their political campaign activities and direct and grassroots lobbying. This includes related issues such as the effect of lobbying on the deductibility of association dues.
Another significant service to our tax-exempt clients is lobbying. Our lawyers represent exempt groups before local, state and national legislative bodies, as well as administrative agencies such as the IRS, the Department of Health and Human Services, state contribution solicitation agencies and local tax assessment offices.
Avoiding or coping with private foundation status also is a major focus of our practice. Qualifying as a supporting organization or a publicly supported organization may be essential to an exempt entity's operational and fundraising plans. We have assisted numerous clients in obtaining definitive or advance rulings on public charity status and in regaining that status after tentative adverse rulings by the IRS. We also counsel clients concerning the various uses for donor-advised funds. New regulations on supporting organizations and donor-advised funds are sometimes more restrictive than the private foundation rules, and we have assisted several organizations that, as a result, decided to opt into private foundation status or convert from 501(c)(3) to 501(c)(4) status.
We assist private foundations of all sizes in complying with:
We have extensive experience with program-related investments in their myriad forms, and have advised several private foundations in converting their own grant-making procedures and tools into a platform for program-related investing.
We serve as advisers both to charities and to potential contributors on fundraising and contribution matters. Clients have consulted us on all aspects of charitable giving, including:
Our lawyers and fiduciary accountants prepare annual information returns, tax returns for non-exempt activities, Social Security tax reports, disclosures relating to major charitable gifts and other required IRS filings.
Administrative dealings and litigation at the federal, state and local levels form another major part of our exempt organizations practice. Exemption applications, requests for rulings and technical advice, assistance on audit and litigation over tax liabilities and tax status are obvious examples. Equally important, however, are other types of litigation such as suits to reform defective charitable trusts, interpret or modify restrictions on charitable gifts, and apply the cy pres doctrine to restricted gifts whose purposes cannot be achieved fully.
We have significant experience in IRS alternative dispute resolution using the Fast Track Settlement Program, an expedited process for the IRS and tax-exempt organizations to resolve disputes before a formal appeal is filed or the parties go to court. The process can provide a significant time and cost savings to exempt organizations.
Our attorneys also have experience with the critical aspects of handling the discovery of embezzlement and other potential criminal concerns, including: