IRS Continues Focus on the Governance Practices of Charities and Requests Comments on Donor-Advised Funds and Supporting Organizations

The IRS has joined the public debate regarding the specific governance practices of charitable organizations with the release on February 2, 2007 of its paper titled “Good Governance Practices For 501(c)(3) Organizations.” The guidelines, which were distributed by Marvin Friedlander, Manager, Exempt Organizations Technical Branch, IRS National Office, focus on nine areas designed to help ensure that directors of charitable organizations understand their roles and responsibilities and actively promote good governance practices.

While these guidelines are still preliminary—and we anticipate that they will be refined following public consideration and comment—they reflect the IRS’s view that the adoption of good governance practices is central to an organization’s ability to be successful in pursuing its exempt purposes and earning public support.

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