501(C)(3) STATUS GUIDELINES

1) No corporation funds can be utilized to support or oppose a political candidate under any circumstances. Our publications can be used to inform and discuss legislative issues with our members. We are also permitted to make statements of our organization’s policy with regard to legislative issues to our members through such publications.  However when a published article asks / suggests that a member contact others outside the organization, and discuss with them the subject of a legislative issue and thereby promote our position on the matter, that suggestion transforms the article itself from a mere informative and permitted function to that of "grass roots lobbying" subject to IRS monitoring and potential limitation. Grass roots lobbying is not allowed in the THN, chapter newsletters, or any other publication made on behalf of the organization.

2) BCHW and chapters need to avoid making a grant or contribution to individuals (e.g., a member or his neighbor has been injured and a chapter gives them some money). Unless there is a non-profit that will funnel it to the person, it could cause the IRS to require BCHW to amend its application, Articles of Incorporation, and Bylaws to permit it. Directors need to understand this and urge chapter officers to comply.

3) Any grant or contribution should only be made to another 501(c )(3) organization or to a federal, state or local governmental entity.  Grants or contributions made to any other type of "exempt organization" should be reviewed and approved by the state board of directors and our tax exempt status advisers prior to being made, to provide sufficient time to determine if any negative impact could potentially be sustained to BCHW' exempt status by such action. Any request for such approval shall include the name, address, FEIN, exempt status (y/n), a brief description of the reason for and scope of the gift.

4) When a chapter or BCHW disposes of an asset, we MUST provide our accountants with the cost and sale price of the item, and the name and address of the buyer.

5) Contributions by any “disqualified person” (officer, director or chapter officer) must be reported to our accountants. If a “disqualified person” contributes $5000 or more to BCHW in a calendar year, special rules apply in that the person making the contribution must be disclosed in the filing of the organizational tax return.

6) A "restricted contribution" is one that an individual makes for a named specific purpose, such as the Legal Defense Fund, or for a specific project.  That donation is a "restricted contribution" in that it must go to that stated fund and be held there until the board authorizes an expenditure of those funds for a purpose fitting the fund description.  If the project failed to be executed, the funds would have to be returned to the donor.  Restricted contributions must be accounted for separately by BCHW. It is important that donors, and those receiving the donations, understand what it means if they donate to a specific project, fund, or purpose.  Likewise, our chapter and state treasurers need to understand the importance of tracking these donations and making sure their financial reports made to their respective boards or members include that information. Chapters must forward such contributions to the BCHW Treasurer, and they must be accounted for separately. The Board must pass a resolution approving each such restriction.

9/9/09