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Subject:  Re: non-profit and back earnings Date:  10/3/1997  1:29 PM
Author:  TMFTaxes Number:  452 of 127519

<<He already is giving us the max in parental giving per year. Is it kosher for him to give the company a donation that we can use towards
the back pay and if it is should we take the money as regular money and pay the taxes up front or should we put them into a 403b? We already have a good amount in mutual funds from his annual parent gifts, so how can we best deal with this situation?>>

As you are probably already aware, if you solicit funds on behalf of a 501(c)(3) organization to be used for your own PERSONAL use, you could run into a BUNCH of problems...not just with the IRS, but with your own Attorney General. If you dad wants to make a charitable contribution to the organization, great. If the board (hopefully you are NOT sitting on the board) then decides to use these funds in order to pay back salaries, so be it.

But before you undertake this transaction, you should really speak with the tax pro involved in your 501c3 organization in order to get his/her opinion on the transaction, and to make sure that a large contribution by a single indiviual will not push you into a "foundation" status.

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