The IRS has special procedures in place for recognizing a group of organizations as tax-exempt if they are affiliated with a central organization. A group exemption can reduce the administrative burden on multiple related organizations, but it can also be difficult to navigate if there is a breakdown in communications or the relationship between the central organization and one of the subordinate entities.
So just how does the group exemption work? And how can organizations avoid pitfalls in navigating this complex relationship?
Practice Note: The IRS has proposed new rules governing group exemptions. Until the new rules are finalized, the IRS is not currently accepting new group exemption letters.
Too many small business owners assume that just because something is on the internet, it must be free to use. For example, have you ever:
In each of these instances, your business is likely to receive a nasty cease and desist letter accusing you of copyright infringement and demanding the immediate payment of money damages.
When you are working hard to build a brand, it’s easy to say “just trademark everything…name, multiple logos, slogans.” And in a perfect world, you should trademark every aspect of your brand. But in the real world, trademark registrations are not cheap, especially on a start-up budget. And multiple trademark registrations won’t matter if you aren’t also making sales, hiring staff as you grow, and improving your product or service.
So if budget is an issue, what should you trademark first? Your name or your logo?
Small businesses and non-profits have had a lot to worry about this year. Not surprisingly, many small business owners and non-profit directors have been asking about ways to protect themselves from lawsuits related to COVID-19. Will a customer or employee try to sue us if they get COVID? Will a waiver protect us from this type of litigation?
In response, the Ohio General Assembly passed H.B. 606 “to make temporary changes related to qualified civil immunity for health care and emergency services provided during a government-declared disaster or emergency fund and for exposure to or transmission or contraction of certain coronaviruses.” So what does this mean for small businesses or non-profits who are wondering about their potential liability if someone claims they were exposed to COVID-19 at your place of business? And what other liabilities are out there waiting to trap the unwary?
You’ve put together your website or app offering your Great New Service™, but now you’re trying to figure out the dreaded Terms of Service. Everyone clicks the box to indicate they agree before signing up for the service, but no one really reads these absurdly long agreements. What do you really need to put in your small business’s terms of service, and, perhaps more importantly, why do you need one in the first place?
This week we continue our series on Essential HR Policies with a look at time off and paid leave. As a small business or non-profit, you might be worried that giving your employees paid time off is simply too expensive. On the other hand, you fear that you won’t be able to compete for the best talent if you don’t offer the kind of time off and paid leave policies that are offered by much larger corporations. And these fears are compounded by not knowing what the law actually requires versus simply wanting to be a great place to work.
Just like you shouldn’t do business on a handshake, you shouldn’t operate your business on a handshake either. But too many entrepreneurs regularly go into business without any formal documentation. If you have business partners, so-called “silent” investors, or took money from friends and family, I cannot stress enough how important it is to have the terms of these partnerships documented in a formal written agreement. Otherwise, it’s just a dispute waiting to happen.
If I had a dollar for every time a client or prospective client told me that their business partner/best friend/family member would never sue them, I’d be writing this article from a beach in the Caribbean right now.
There are a few critical questions that every company operating agreement* should answer.
Previously, we looked at the difference between issue advocacy (which is permissible for non-profit organizations) and lobbying (which becomes problematic for a 501(c)(3) if it is “substantial”). So what is your non-profit organization to do if it decides that the best way to advance the mission is to influence legislation? This is where other types of tax-exempt status come into play.
This week, we continue our series on Essential HR Policies by taking a closer look at what should be in your employment files.
Common Record-Keeping Mistakes
Most of our clients run their business or non-profit because they are pursuing a passion, not because they enjoy record-keeping. But failing to keep thorough and accurate payroll records makes it impossible for you to complete timely and accurate tax filings (including issuing W-9s or 1099s at the beginning of the year) which can expose you to penalties and late fees. And the lack of records means you can’t defend your organization from claims of unpaid wages, salary, or overtime.
A licensing agreement is a contract in which you, the licensor, gives someone else, the licensee, permission to do something that they otherwise would not have the right to do. There are many situations in which a small business might use a licensing agreement:
While licensing agreements need to be customized to fit your particular business situation, there are some common terms that most licensing agreements should address.