This topic contains 1 reply, has 1 voice, and was last updated by Rolando A 2 years ago.
May 21, 2016 at 8:56 am #261
Van Der Faye
As many of you know I have been pressuring the current board for transparency. Rolando has been providing courteous responses, which are greatly appreciated, but where IS the board? The board, who is responsible to the society. The board, who is legally responsible to ask many of the questions I’m inquiring. Why are they hiding? Why are they posting on other threads of discussion and events, but unable to come forward about documentation they legally have to present to the public upon request?
This starts with a little history on being a “Non-Profit”, and being 501(c)(3) tax exempt. The definition on the secretary of state website is as follows: A â€œnonprofit corporationâ€ is a corporation no part of the income of which is distributable to members, directors, or officers. Being a Non-Profit is easily enough said, as long as your board members, members and affiliates are not splitting the income you can be a non-profit. However, filing to be one means you have to present a charitable argument of what your organization is doing and how it benefits others or a community.
By benefiting a community and pledging yourself to be charitable there are certain disclosures that a non-profit has to make, legally. One of the most important is their bylaws. The rules that the organization’s board must follow to retain their integrity with the community. These contain how they do business. How people get elected to the board, how much notice must be given before meetings, what positions are available on the board and how to handle votes.
SASDS has 20 bylaws as of 2009, the most recent document Rolando has found. SASDS is in violation of half of them, at minimum.
Article III Section 1: Annual Meeting
Article III Section 2: Notice
Article III Section 1: Meetings
Article III Section 3: Notice
Article III Section 4: Quorum
Article IV Section 2: Board Responsibilities
Article IV Section 3: Email Voting
Article IV Section 4: Board Elections
Article IV Section 6: Officers and Duties
Article IV Section 9: Special Meetings
One of the biggest bylaws that they’re breaking is Article IV Section 6. This defines what roles there are on the board and at present the ones listed aren’t even legal by the Secretary of State’s requirements. “The Texas Business Organizations Code requires a nonprofit corporation to have at least three directors, one president, and one secretary. The same person cannot be both the president and secretary”. So outside of not providing adequate notice of meetings, not accepting email votes, not having an annual meeting followed by a separate board election meeting and not approving the budget for all persons in the organization and for the organization itself… Can we really have a board election on positions that don’t legally exist? Can we really have an election voted on by a board, comprised of other positions that don’t legally exist, that is in violation of half of their bylaws?
Another important disclosure is their financial information. Yes. You have to show you are in fact following the law, AND filing taxes.
The IRS has a cute video course on required disclosures that I think the SASDS board needs to see. It’s ironic that the demo organization is a big jazz society. https://www.stayexempt.irs.gov/Existing-Organizations/Required-Disclosures . What this says is that upon request of the public, as a non-profit, you must provide:
-Exemption Application (Form 1023 or 1023-EZ)
-Determination Letter from IRS
-Three most recent annual returns
-Three most recent Form 990, 990-T, 990-PF or 990-EZ
So, just why would the board be refusing by ignorance to provide the information they’re required to by law? Did you know that if you don’t file your taxes three years consecutively as a 501(c)(3) tax exempt non-profit that you lose your tax exempt status? Did you know that it’s public record? And that it’s also tax evasion if you didn’t file ANY taxes, and continuing to advertise yourself as a 501(c)(3) tax exempt non-profit in good standing could be considered fraud? Did you ALSO know that any fees and penalties for having your 501(c)(3) status revoked must be paid out of pocket, and not with charitable moneys? And that all income and donations post revoking date are taxable? Which means even if you lose your 501(c)(3) tax exemption you still have to file taxes! Go figure! It’s all pretty interesting!
It’s pretty easy to keep your 501(c)(3) tax exempt status, though. There’s even ANOTHER cute video course on it! https://www.stayexempt.irs.gov/Existing-Organizations/Maintaining-501c3-Tax-Exempt-Status
Board, this is for you. Since you’ve chosen to ignore me this week hoping I’d go away (Much like the IRS deadlines) you now have 24 hours to come clean or I might just do it for you in full color.
Non-Profit for beginners links!
Secretary of State FAQ for NonProfits
IRS’ video courses (with pdf companions!) on maintaining your tax exempt status
https://www.stayexempt.irs.gov/Existing-OrganizationsMay 21, 2016 at 5:08 pm #262
You point out many valid points what is the goal of this just to be clear. For the board to admit not complying with bylaws or to assist the board to correct the issues. The post sounds like a threat and that is never conducive towards progress. At this point the Society would benifit more from transparency like you have pointed out many times it lacks, and positive energy to correct these issue. If the goal is to assist to correct the issues what steps should the board take to resolve these issues.
For the record, none of these seem like huge issues and can be corrected. The Society provides a lot of value. I’m sure there are many that support the society despite these issue. This does not abstain anyone for resolving any lack of compliance.
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