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2008 GuideStar Nonprofit Economic Survey Kickoff


On October 6, we will send an e-mail inviting Newsletter subscribers associated with
501(c)(3) organizations to participate in our seventh annual nonprofit economic survey. The survey is designed for U.S. public charities and private foundations. It will run October 6-20, 2008.

  • If you would like to be sure you receive a survey invitation, click here:
    Yes, invite me to take the 2008 GuideStar nonprofit economic survey

  • If you would like to be sure you do not receive a survey invitation, click here:
    No, do not invite me to take the 2008 survey
The survey is designed to take charitable organizations' financial pulse in order to answer the question "How are nonprofits doing this year?" The results will be released to the media, posted on the GuideStar Web site, and announced in the GuideStar Newsletter.

From the President's Office, October 2008

Dear Friend:

I am pleased to announce the creation of GuideStar's Forum of Nonprofit Advisors, a Web-based discussion group that advises us on issues affecting our nonprofit users. Already, a test group of advisors has given us invaluable advice on making the GuideStar Exchange accessible to smaller organizations and the types of incentives to offer nonprofits that update their GuideStar reports.

If you would like to know more about the Forum, go to or contact us at advice@guidestar.org. The Forum will be an invaluable resource for us as we make additions to our Web site, upgrade services, and launch new tools. We're excited about this new way to get your feedback on these important issues as we continue our efforts to make GuideStar more responsive to your needs and interests.

And now another piece of news: GuideStar's name has been officially changed to GuideStar USA, Inc. Before the paperwork went through, GuideStar was the name of our database and our "doing business as" name registered with the state of Virginia. Our legal name was Philanthropic Research, Inc.

Philanthropic Research, Inc. was the right name for us when we were established in 1994. Then, as now, our mission was to promote philanthropy and improve the nonprofit sector by making nonprofit information widely available. We were going to create a resource where donors could research their charitable giving. Once we named that resource GuideStar, however, the term became synonymous not just with the database but also with our Web site and our entire organization.

Side note: We often receive calls from nonprofits that have changed their names, asking how they can get their new names reflected in our database. We can only change an organization's name if the change has been requested through the IRS. Often, however, we can add a doing business as (dba) name to a nonprofit's listing. For more information, see our FAQ on name changes.

A new name and a new advisory group: evidence of our commitment to growing and adapting while remaining true to our mission.

Sincerely,

Bob Ottenhoff
President and CEO

Public Policy Advocacy: The Case for Nonprofit Engagement

In 2008, as candidates for public office court traditional voting blocks on the path to election victory, the nonprofit sector has enormous potential as an untapped political force to shape the nation's future. The nonprofit sector—our ever-expanding asset of "social profit" organizations focused on serving the public good—is creating the most job growth, the best new ideas, and the most effective solutions to the toughest chronic social problems that are plaguing communities throughout the country.

Though unknown to many state and federal lawmakers, the nonprofit sector—if called upon by the nation's leaders—holds a rare opportunity to unleash the full force of America's entrepreneurial spirit with a drive and commitment that can solve our nation's most challenging domestic problems. Through this effort, the nonprofit sector would be clearly recognized for what it truly is, a thriving and indispensable component of America's economy.

But to produce such sea change results, nonprofit innovation and solutions must be applied on a national scale. And achieving this result will take a bold and enterprising merger of governmental and nonprofit sector forces and resources. To ignite and achieve this transformational merger, the nonprofit sector must focus on a range of steps, particularly its full engagement in the political process. The nonprofit sector must engage in political action at a level that matches the sector's substantial economic muscle or its $660 billion dollar annual contribution to the U.S. economy.


IRS Updates, October 2008: New 990-EZ Instructions, Form 990 Webinar, and Elimination of the Advance Ruling

Last month, the IRS released instructions for the new Form 990-EZ, announced a free Webinar on preparing the new 990, and dispensed with the advance ruling for 501(c)(3) public charities.

IRS Updates, August 2008: Comment Period for Form 990-EZ Changes and Workshops for Small and Mid-Sized (c)(3)s

Changes to Form 990-EZ

The IRS invites written comments on changes to the 2008 Form 990-EZ. Comments must be received at the IRS no later than September 8, 2008.

Background

To comply with new filing requirements, the IRS proposes to allow Form 990-EZ filers to file six schedules developed for the 2008 Form 990:

  • Schedule A, Public Charity Status and Public Support
  • Schedule C, Political Campaign and Lobbying Activities
  • Schedule E, Schools
  • Schedule G, Supplemental Information Regarding Fundraising or Gaming Activities
  • Schedule L, Transactions with Interested Persons
  • Schedule N, Liquidation, Termination, Dissolution, or Significant Disposition of Assets

To Submit Comments

Send written comments on or before September 8, 2008, to:
R. Joseph Durbala
Internal Revenue Service, Room 6129
1111 Constitution Avenue, NW
Washington, DC 20224
All comments will become part of the public record and will be summarized or included in the IRS request for OMB approval of the changes to the 990-EZ.

For more information, including issues the IRS would to like see comments address, see the notice from the July 8, 2008, Federal Register.

Fall 2008 Workshops for Small and Mid-Sized 501(c)(3) Organizations

In November and December, the IRS will offer one-day workshops for small and mid-sized section 501(c)(3) exempt organizations:

  • October 21, 22, 23—Chicago, Ill.
  • November 18, 19, 20—Detroit, Mich.
  • December 2, 3, 4—Memphis, Tenn.
These introductory workshops are designed for administrators or volunteers who are responsible for an organization's tax compliance. Each workshop will be presented by experienced Exempt Organizations staff members and will cover the following topics:

  • Tax-Exempt Status—Benefits and responsibilities of tax-exempt status under
    section 501(c)(3) and actions that may jeopardize an organization's tax-exempt status.
  • Unrelated Business Income—The definition of unrelated business income, common examples, common exceptions, and filing requirements; includes a discussion of charitable gaming.
  • Employment Issues—Classification of workers and filing requirements for employees and independent contractors.
  • Form 990—An explanation of the Form 990, tips on record-keeping, and advice for completing the return; includes a discussion on the "e-Postcard" filing requirement.
  • Required Disclosures—Overview of disclosures tax-exempt organizations are required to make, including requirements imposed by the Pension Protection Act of 2006.
The workshop does not address applying for tax-exempt status or issues related to
non-501(c)(3) organizations.

Pre-registration is required. See more information

Suzanne E. Coffman, August 2008
© 2008, Philanthropic Research, Inc. (GuideStar)

Suzanne Coffman is GuideStar's director of communications and editor of the Newsletter.

Bring Community into Your Communications

"I must say that I have seen Americans make great and real sacrifices to the public welfare; and have noticed a hundred instances in which they hardly ever failed to lend faithful support to one another."

-- Alexis de Tocqueville,  Democracy in America
Set aside a few seconds to try to imagine what the United States of America would be like without a healthy, vibrant nonprofit sector.

Your first reaction is likely to be in question form: How many more children and families would go hungry at night or not have access to health care of any kind? When a natural or manmade disaster strikes, who would provide all the necessary temporary food, shelter, and clothing to the victims? Who would work to preserve our inner cities and rural communities or ensure that our artists have venues and means to support their talents?

Such a list could go on forever. Yet for me it's these types of questions and answers that represent one of the biggest pitfalls most nonprofits stumble into when it comes to communicating their true value to the communities they serve.

A True Story

A couple of years ago, I was having lunch with the executive director of a small community development corporation (CDC) and her board chair in a little café when she turned to me and matter-of-factly said, "You know, last year we were responsible for more than $6 million worth of economic activity in this community, and most of it went to small construction firms, tradesmen, local retail stores, and other small businesses."

I was stunned. That was a big number for the size of the small city (about 80,000 residents) the CDC was serving, especially given the fact that the community was in the midst of a minor recession.

"Who else, outside of your organization, is aware of that fact?" I asked.

The executive director and board chair looked at one another, and almost in unison said, "No one."

I became even more stunned.

Here was one of the best brand messages this organization could have been shouting from the rooftops, and yet it was obvious they had no strategy for getting this kind of valuable information out to folks with a keen interest in knowing—including civic organizations such as the local Chamber of Commerce, government officials, and potential funders.

One of the Best-Kept Secrets in Town

To most people in the community, some of whom may have benefited directly or indirectly from this organization's efforts, it was just another nonprofit out there doing whatever it is nonprofits do.

Instead of effectively cultivating goodwill and new revenue streams by letting the community know the impact it was having on the lives of so many beyond its direct client population, this particular organization was content to be one of the best-kept secrets in town.

Broaden Your Message

Tell the world how the entire community benefits from your work.

When de Tocqueville wrote the comment above nearly 170 years ago, he wasn't just talking about people helping people; he was talking about people sacrificing for the betterment of the "public welfare," which translates into the betterment of their communities.

And de Tocqueville was right. Whether your organization provides housing, health care, literacy classes, or drug and alcohol rehab services or supports conservation efforts or human rights, whatever, we all—as a community—benefit from your work. And that's a message each and every nonprofit needs to emphasize, as does the sector as a whole. It's not about our client base; it's about all of us.

Now, ask yourself again, "What would our community—and nation—look like, or how different would it be, if the nonprofit sector did not exist?"

The image is stunning!

Larry Checco, Checco Communications
© 2008, Checco Communications

Larry Checco is president of Checco Communications and author of Branding for Success: A Roadmap for Raising the Visibility and Value of Your Nonprofit Organization. Larry is a nationally recognized public speaker, workshop presenter, and consultant on branding.

Communicating 3.0 for Nonprofits: Succeeding in Your Messaging and in Maximizing Methods

Nobody ever said communicating was easy.

Taking a message and relaying it to an audience so that they not only understand it but act on it is an onerous task indeed. Especially for nonprofits, which often have to do so with limited resources. Adding to the challenge is the fact that in the Web 2.0 world, our jobs as communicators have changed dramatically. Social media, mobile devices, and the democratized Web have turned the ways in which we think about crafting messages and targeting audiences inside out.

The technology that powers much of today's communication, allowing us to blog, text, record, type, post, create, talk, and share, is at once enabling and disabling, exhilarating and overwhelming, connecting and disconnecting. We live in a world where presidential candidates use Twitter to announce their running mates and where nonprofit workers around the globe can document a human need their organization is serving by capturing video on their cell phones and uploading it to YouTube—faster than international news correspondents can feed footage to CNN.

But are increased speed, universality, and technological savvy making our jobs as communicators easier? Yes and no.

Similar to the Industrial Revolution of the late 18th and early 19th centuries, today's "Communication Revolution" offers new opportunities to promote your organization's messages and leverage the latest technologies to amplify those messages. What we need to do, however, is a bit of self-education.

Take, for example, the traditional press release. Most nonprofits are familiar with this standard 400-word communication piece, and it's still an efficient, effective way to reach and build positive relationships with media, consumers, and other stakeholders. But in today's Web 2.0 world, we need to make sure we blend the best of yesterday's traditional PR strategies and tactics with the latest not-so-traditional strategies, tactics, AND technologies. The ability to understand, integrate, and leverage them is key to your future success.

The old adage holds true: The more things change, the more they stay the same. When creating a press release, the fundamentals of good communication, adaptations of the simple rules we learn early in our careers, are as important as ever, and continue—with the power of new technologies—to further successful communication strategies.


Turning Financial Advisors into Fundraising Allies

Adapted from Financial Advisors as Guiding Stars to Philanthropic Giving

Have you ever been close to closing a large gift only to have the donor's advisor kill it?


2008 GuideStar Nonprofit Compensation Report Now Available

The eighth annual edition of the GuideStar Nonprofit Compensation Report was released September 25, 2008. Derived from information on more than 84,421 individual positions at more than 58,400 tax-exempt organizations for fiscal year 2006, it remains the most comprehensive nonprofit compensation analysis available and the only one based entirely on IRS data.

The report includes data on non-charitable organizations as well as public charities and private foundations; an executive summary based not only on this report but also on data for previous years; and information on incumbent compensation. Findings reported in the executive summary include: