Sidley has a substantial and varied practice involving representation of tax-exempt organizations. Clients include a wide variety of charitable, religious and educational organizations described in section 501(c)(3) of the Internal Revenue Code. These include private foundations; community trusts and other broadly-supported public charities; universities, colleges and schools; cultural and performing arts organizations; museums; hospitals and healthcare organizations; and religious organizations, including church pension funds. In addition, we represent a substantial number of organizations which are tax-exempt under other provisions of the Internal Revenue Code, such as trade and professional associations, civic leagues and social clubs.
A significant portion of our work for tax-exempt organizations is tax-related. For example, we regularly counsel organizations on:
- Securing recognition of tax-exempt status;
- Unrelated business income issues;
- Excess benefit transactions and private inurement issues;
- Employee benefits;
- Tax-exempt bond financing;
- Charitable planned giving and development efforts;
- Issues regarding grants and other payments to foreign organizations and individuals;
- State and local tax matters, including state real property and sales tax exemptions;
- Tax consequences, unrelated business income and otherwise, of “alternative” investments; and
- Tax controversies, both before the Internal Revenue Service and the courts.
We also have extensive experience in counseling private foundation clients, including large, nationally-recognized foundations, smaller corporate and family foundations and private operating foundations, on the special tax rules applicable to these organizations, such as the rules on avoiding self-dealing, satisfying the minimum distribution requirements, avoiding excess business holdings and jeopardizing investments and complying with the expenditure responsibility rules.
We regularly advise clients on non-tax regulatory matters such as compliance with state charitable trust statutes and related laws concerning solicitation of contributions. This representation may involve counseling charities on appropriate objectives and vehicles for investment of their property, creating special endowment funds to allow for proper management and expenditure of charitable property and observance of donor restrictions, instituting trust reformation proceedings and obtaining permission for an organization to solicit contributions in different jurisdictions. In addition, we regularly advise not-for-profit corporations regarding corporate governance, and have prevailed in a number of litigated cases to resolve governance disputes involving associations and foundations.
In addition to providing these specific services, we act as principal outside counsel for several foundations, educational institutions and other organizations. We routinely represent these organizations in contractual negotiations, real estate and other transactions, organizational restructurings, environmental matters and general litigation matters. We also counsel organizations on employment and compensation matters such as termination of employment and compliance with applicable labor and employment laws. Our practice is designed to meet the diverse needs of our tax-exempt clients.
In the representation of trade and professional associations, we provide service in virtually every area of law that might affect a professional association or credentialing board. In addition to the services we provide with respect to tax-exempt organizations generally, we provide a large number of associations with advice concerning the following issues: antitrust, regulatory, credentialing (accreditation and certification), examination, association and professional liability, conflicts of interest, confidentiality, discipline, publications, trademarks and copyright, industry relationships, and appeals and other due process matters. We also prepare briefs amicus curiae on substantive issues of interest to associations and their members, and often monitor legislative and other legal developments that may be important for professional associations.