IRS Focus on Exempt Organization Compensation

Corporate scandals, excessive compensation packages and questionable accounting standards have made headlines over the past several years. While much of the focus has been on public companies, Section 501(c)(3) tax-exempt organizations (EOs) have received their share of attention as well. In response to widespread media reports of excessive compensation and conflicts of interest, the IRS has increased its audit presence in the EO sector and will exact penalties against executives who receive excessive compensation and, in some cases, against directors and officers who approve such payments knowing them to be excessive. This LawFlash discusses the new IRS audit program and explains what EOs should do to prepare for a possible audit.

For the full story, please view the PDF.