1,Explore the difference between public charities and private foundation status.

Feed the Hungry Children, a (fictitious) not-for-profit tax-exempt entity under IRC Sec. 501(c)3, has been in operation for six years. The mission of the group is to provide healthy breakfast meals to children in inner city schools, so they can best learn. A wealthy local philanthropist has been meeting with the organization hoping to change the direction of the organization in return for a $1,000,000 permanent endowment donated to the group. While these negotiations were taking place this year, the organization suspended its normal operations. The draft of the Form 990 for this fiscal year shows 0 revenues and 0 expenses for this fiscal year and penciled in is a $1,000,000 gift from the philanthropist. The treasurer of the Board is drafting the Schedule A for the Form 990 in preparation for reporting to the Board whether the organization's status has changed form a public charity to a private foundation. Go to the www.irs.gov website and obtain Form 990, Schedule A. In your own words, construct an argument to support why this tax-exempt entity is still a public charity.

2,

Examine Form 990 for Clean Water Action.

Locate the most recent Form 990 for the Clean Water Action at www.guidestar.org or from their website www.cleanwateraction.org. You may have to register for Guidestar; however, there is no cost for the basic access. Under which section of the Internal Revenue Code is Clean Water Action tax-exempt? See top of page 1 of the Form 990. What is the compensation of the highest paid officer or director (see Part VII of the Form 990 and/or Schedule J)? Which schedules did the organization complete (e.g., A, B, .... R)? Note: schedules start right after the twelve parts (roman numerals) of the core Form 990. Is their audited annual financial statement available on Guidestar or website?