Tax/Legal Topics for Social Enterprises

Person Filing Tax Documents

Some of the most complex and confusing issues around social enterprise involve legal and tax topics. Will we get in trouble if we do it that way? Do we have to pay taxes on that revenue? Which tax forms do we have to fill out?

Those concerns are made more difficult by the tendency of the IRS to obfuscate some of the issues (although they are getting better), and the high price to access quality legal advice from lawyers.

To help address that problem, the 7500 subscriber npEnterprise Forum listserv has included dozens of postings about US tax and legal issues for social enterprises, mostly from lawyers working directly on these issues. As editor, I recently compiled many of those postings into this legal/tax frequently asked questions file.

Here are the topics that currently appear in that FAQ:

  • How much earned income can a nonprofit generate?
  • Is income earned by a thrift or book store subject to UBIT?
  • Are sponsorship and advertising fees subject to unrelated business income tax?
  • What is private inurement – and why should social enterprises be concerned about it?
  • Should I structure my new social enterprise as a for-profit or nonprofit?
  • What about nonprofit – for-profit joint ventures?
  • Can nonprofits do consulting?
  • How should I structure my incubator?
  • Should I set up a for-profit subsidiary?
  • Is there an exemption from minimum wage if certain requirements are met?
  • Do volunteers who sell our products have to claim this on their federal tax forms?
  • Purchase an existing forprofit venture?
  • In what state should we incorporate?
  • How to set up a for-profit/nonprofit partnership?

I hope you will find this information useful. To my knowledge, this is the most comprehensive collection of legal and tax information about nonprofit social enterprises available anywhere on the web. While I am not a lawyer, I have found this collection useful as a general guide when exploring options for social enterprises. Good luck!

X is for eXtra special

Red-and-white-love-shaped-balloons-floating-in-the-sky

How can you be extra special to your spirit this week? How can you show love to your soul? The work that we do in our lives whether on the job, at our home, or on the stage, we need to be extra special to ourselves. If we don’t replenish, renew and refresh our spirits, then we won’t be able to give the best of who we are to others.

Overstretched

We get the importance of this, yet many of us don’t put it into action. Remember me writing about the bungee cord hitting me in the head and needing to get stitches (see V is for Vulnerable)? The symbolism of the bungee cord is relevant. We like to stretch ourselves to the limit, which is what is great about a bungee cord. You can take this little cord and amazingly stretch it to great lengths. Yet, when it’s been overstretched, it can snap back in the fiercest way (my nice scar proves it). I, like many of us, have been overstretching myself for years. If you’re like me, you have many things you want to do, relationships you want to nurture, and goals you want to achieve. And all of us only have so many hours and only so much capacity to achieve it all in a day or in our lifetime.

Permission slip to stop working harder

I was listening to my Divine guidance (see D is for Divine) and heard the message that I need to take some time off and stop “working hard”. So I gave myself permission to stop working harder this month so I can focus on being extra special to my soul.

So this is what I did. Another phrase on my vision board says, “God does His best work when you do no work.” I let all my work worries go. This “permission slip” to stop working harder has given me this extra special freedom. Freedom from expectations on what I should be doing or accomplishing. Freedom to be extra special to myself and pursue the work that inspires me.

Show yourself some love

I was inspired to write this entry while I was giving myself “some extra love” because of the upcoming international day of self love on Feb. 13. This amazing woman, Christine Arylo, created this day to help all of learn how to “fall madly in love with ourselves.” I do have on my vision board “goddess of unconditional love” so I thought this would be a good time for me to live that out and who best to start showing more love to – me.

Madly In Love With Me Day is Feb 13!

I encourage you to check out her resources, including inspiring songs, self-love kit and audio interviews. I’m making a self-love date with myself on Feb. 13. I’ll check back in with you next week to let you know how this extra-special day for my soul went. How about you? What can you do to show yourself some love? We would love to hear from you!

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For more resources, see our Library topic Spirituality in the Workplace.

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Janae Bower is an inspirational speaker, award-winning author and training consultant. She founded Finding IT, a company that specializes in personal and professional development getting to the heart of what matters most. She started Project GratOtude, a movement to increase gratitude in people’s lives.

Introduction To Government Grants

two-colleagues-working-on-a-government-grant-proposal.

Every year, government agencies around the country provide over $200 billion in grants … for specific services to local communities. Today, there are approximately 2,000 federal grant programs and over 40,000 state grant programs.

But before you get all excited about all that government money, you must really understand what government grants are and who is eligible to apply for them.

What Is A Government Grant ??

A (federal, state, local) government grant is the money awarded to a nonprofit organization (NPO) consistent with a contract between the government and the NPO – where the latter provides the service for which the former pays. (Grants, of course, do not have to be repaid.)

There is an application process for all government grants, and not all applicants qualify. Then, when you receive a grant, you are agreeing to carry out the activities described in your grant application and to adhere to all the conditions of the award. All such grants include various conditions, one of which is always that the grantee must provide periodic financial and program reports on their “contractual” activities.

There Are Two Kinds of Federal Grants. Continue reading “Introduction To Government Grants”

Facebook Redesigns Pages

Facebook logo in a splash screen

More Similarities to Profiles

Launched today, Mashable reported on Facebook’s new Page redesign – giving users an experience more consistent with Profiles. Right away, you’ll notice the differences in the new layout. The new Page redesign will also operate more like Profiles. According to Rohit Dhawan, lead product manager for Facebook Pages, “We strongly believe you should have consistent experiences when possible.”

The redesign rollout was not completely unexpected, since it debuted in late 2010, when they accidentally launched it, but very quickly took it down, due to features that were apparently ill-conceived. But now, just a few short months later, they’re back at it with a much more thorough approach that’ll make it easier for everyone to learn and use.

“A Page can now use Facebook as if they were an individual with the ability to interact with other pages,” Dhawan said. “It provides interesting content when people are visiting the Page.”

Creative Facebook Page Photos

Pages can also now display photos at the top. Take a look at some creative facebook photo design elements, including segmenting photos and upside-down photos. A great way to distinguish your Page from your competitors’!

Other Important Changes

Some of the behind-the-scenes changes make social networking on Facebook more meaningful. Important changes include:

  • Page Admins have the ability to post and comment on other Facebook Pages through the “Login as Page” feature
  • The left-hand menu for editing pages has been removed in favor of a new navigation menu
  • Brand info can be placed at the top of the Page under the main title
  • A new section shows users how many of their friends have also “liked” that particular page
  • Most popular content will gravitate to the top

Test it and Tweak

Admins have until March 10th to preview and play with their design elements. After that, Facebook will automatically update all Pages to the new design. In the meantime, have fun with their Page Tour and a manual that explains the new design.

What do you see as the pros and cons of Facebook’s new Page redesign? Any suggestions for other Admins?

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For more resources, see our Library topics Marketing and Social Networking.

.. _____ ..

ABOUT Lisa M. Chapman:

Ms. Chapman’s new book, How to Make Money Online With Social Media: A Step-by-Step Guide for Entrepreneurs will be available very soon. With offices in Nashville Tennessee, but working virtually with international clients, Lisa M. Chapman serves her clients as a business and marketing coach, business planning consultant and social media consultant. As a Founder of iBrand Masters, a social media consulting firm, Lisa Chapman helps clients to establish and enhance their online brand, attract their target market, engage them in meaningful social media conversations, and convert online traffic into revenues. Email: Lisa @ LisaChapman.com

Six Ways to Get Counted in HR

A-HR-staff-looking-at-the-camera-in-an-office

Everything that can be counted does not necessarily count and everything that counts can not necessarily be counted. Albert Einstein

With all the business change that has occurred over the past few years, there is no question that the HR Department would need to keep up. It is likely that in nearly every organization there has been an emphasis on analysis of what is working and not working in all areas of the business. The trouble for HR is that sometimes, it’s hard to measure in true financial and business terms especially when the HR programs are working and things are going well in the organization. It seems that when the HR programs are working, someone else can always take the credit. But when HR is bad, it seems that it is easier for the organization to tie their failures to financial measures.
So what can HR pros do about it? Here’s a list to get you started:

1. Remove the HR Silos and ensure your talent departments (recruiting, compensation, learning and development, etc.) are working together.
2. Integrate the HR strategy to the business strategy.
3. Run your HR business as a business.
4. Know and understand the metrics. If the finance guys have them, know them and understand them. If they don’t, build a relationship (should be a strength in HR) and get them developed. If you don’t know how, find a few partners to help out.
5. Be prepared to adjust your strategy at any time necessary. This is business; it changes. Know how changes in budget and other business changes will affect the HR Strategy in financial terms. If you can’t do this, you don’t have a voice at the table even if you have a seat.
6. Enjoy the ride. Celebrate the good, fix the bad and know the difference.

For more resources, See the Human Resources library.

Sheri Mazurek is a training and human resource professional with over 16 years of management experience, and is skilled in all areas of employee management and human resource functions, with a specialty in learning and development. She is available to help you with your Human Resources and Training needs on a contract basis. For more information send an email to smazurek0615@gmail.com or visit www.sherimazurek.com. Follow me on twitter @Sherimaz.

following previous post: is “PM” just common sense

Well here’s my view. If project management (or delivering projects successfully, on a more often than not basis) were purely common sense, then the evidence to do with project delivery performance would tell a completely different story. For example, a UK report by the Royal Society of Engineering a few years ago quoted some frightening numbers on the cost overruns (in £) that is wasted each year in the UK on IT projects alone. There are many other examples from other industries to back this up this assertion.

It is an interesting thought as well that in many fields of business (engaged in projects) there are often professionals in abundance (i.e. degree or better qualified staff) working on those projects, and often they still produce disappointing results, i.e. unsuccessful, sometimes spectacularly so. You would suppose that this group could master what some say is just “common sense”, if this is true?

The reasons for poor project delivery can sometimes be complex, including:

– lack of real pressure (in some industries) for improved delivery performance
– lack of corporate capability relating to business level Governance of key projects
– lack of accountability of key individuals across the project for delivery performance
– issues of communication, poorly applied practices etc

The list could go on and on, and does depending partly on Geography and industry sector.

The best examples of project management practice are: a) relevant to the industry, technology (or domain) being managed, b) focused on the issues that are key to the sponsor or business; and c) are routinely employed by project teams as key disciplines which they get obvious value from; they do not consign them to the “we haven’t had time to do that yet” pile. In other words key professionals understand the relationship and difference between core project work and project management. In the history of the industrial era to date, evidence does not seem to support that this “common sense” prevails yet in buckets in most people in most organisations?

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For more resources, see the Library topic Project Management.

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14 PR Tips from Known Journalists

Public Relationship Tips

 

On February 9, HARO —Help A Reporter Out (HARO), the free service that links journalists looking for viable sources to clients of PR companies — sponsored a four-person panel of national scribes to talk about the do’s and don’ts of the PR world in their world.

The hour-plus conference (paid) call didn’t provide any deep revelations to seasoned PR practitioners, IMHO (and you will recognize some of the topics below that they covered on this blog). But it did a good job of re-enforcing basic and not-so-basic tips on how journalists like to be pitched, among other topics. In other words, it was a refresher course for the crusty and perhaps, some practical help for those innocents just treading into the field.

On the call were HARO founder and panel moderator, Peter Shankman, the small business reporter from The Wall Street Journal, a travel writer for USA Today, a freelance journalist for Crain’s Business News in New York and other publications and a contributor to AOL — who covers the Weird News beat and also does work for other media outlets.

Here were some highlights:

  • Strong Subject lines are very important: Rarely do the terms “Press Release” ring anyone’s bell. Write an intriguing headline.

 

  • Know what the reporter covers and read some of their stuff before pitching.

 

  • Personalize your email; mass email blasts are a turn-off that beg for the Delete button.

 

  • Identify a strong news hook. See what’s happening in the news cycle and if your subject, client, product fits in. Then shape your pitch.

 

  • Is it wise to qualify news release marked as Embargoed news? The WSJ reporter says they never honor embargoed releases. The others were less forceful on that front. Use discretion.

 

  • All of them spoke very highly of HARO as a helpful service that some people, however, abuse on occasion by pitching off- topic — which will get you booted off HARO yesterday.

 

  • Brevity is always a plus on a pitch.

 

  • The panel unanimously turned thumbs down on pitches made through social media like Facebook and Twitter, Fax and the U.S. mail — for me this was the eye-opener of the hour. Use their email first. Be prudent about follow up phone calls. Know when the reporter’s deadlines are and respect them.

  • Most panelists rely on press releases only for facts; rarely does a news release move any of them to write a story, so really work on your pitch.

 

  • Never send attachments.

 

  • Never send products (unless asked) — or gifts. Most newsrooms cannot accept gifts valued over $20.

 

  • You can ask a reporter for face time over coffee or lunch but most will say no; they don’t have time. The Weird News guy however was a little more flexible and liked the idea, although he’s outside of San Diego in a small town.

 

  • The panelists all described the best pitches as those that are current to news making — which means you might actually have to watch TV, listen to radio and read the newspaper and web news aggregators (believe it or not, a few people I know in this profession never do!)

 

  • It’s fine to provide background to reporters for future news stories, esp. if you missed being part of something they just wrote about and you want your client on their radar.

 

Let me know what your questions and tips are and we’ll address in a future column. Happy pitching!

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For more resources, see the Library topic Public and Media Relations.

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Martin Keller runs Media Savant Communications Co., a Public Relations and Marketing Communications consulting company based in the Twin Cities. Keller has helped move client stories to media that includes The New York Times, Larry King, The CBS Evening News with Katie Couric, plus many other magazines, newspapers, trade journals and other media outlets. Contact him at kelmart@aol.com, or 612-729-8585

Transparency in Crisis

Persons working together in an office using their tab

Tell the whole story, or suffer the consequences

There’s nothing the media loves to expose more than a cover-up. Any hint of things being less than kosher in the aftermath of a crisis will result in heightened scrutiny, and if there’s anything being hidden then someone out there will dig until it comes out. What should you do with those unsavory details, then? Brad Phillips, of Mr. Media Training, explains:

Get It All Out: It’s human to want to bury the bad parts of a story that haven’t yet gotten out. But trying to bury negative parts of the story often extends the crisis and makes it worse. Information usually gets out anyway, and the lack of forthrightness reinforces suspicions about your integrity. If you think something is likely to get out anyway – and it probably will – it’s better to get it out on your own terms instead

Getting it out on your own terms accomplishes two things. First, it gives you credibility in the eyes of your stakeholders, always important if you want your words to be taken seriously. Second, it helps to eliminate the information gap that is often filled by hurtful rumor and innuendo and instead replaces it with verified facts, meaning your reputation takes less damage and can be repaired more easily.

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For more resources, see the Free Management Library topic: Crisis Management
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[Jonathan Bernstein is president of Bernstein Crisis Management, Inc. , an international crisis management consultancy, and author of Keeping the Wolves at Bay – Media Training.]

Leading the Dynamic between Complexity and Clarity

Businessman-leader-modern-office-with-businesspeople-working

A number of years ago I was called by a client because “things are falling through the cracks.” Suspicious that the issue was systemic (rather than technical or due to poor performance), a systems analysis was performed.

The world today is so interconnected and interdependent that leaders need to differentiate situations that are Complex from those that are complicated – think Everglades (Complex) versus Rolex watch (complicated) or customer relations (Complex) versus financial spreadsheet (complicated). Situations that are complicated produce problems that can be solved, creating the jigsaw puzzles of business that most leaders are prepared to analyze and handle.

On the other hand Complexity evades solution. There are too many interdependencies and feedback loops to control the system. Push here and the effect is felt on another continent. Constrain the system financially and it responds by innovating, producing unpredictable new products and services. Complexity is now such a large part of business that the 2010 IBM CEO study focused on it and management academics research and publish Complexity Leadership Theory (CLT)[i]. Today I am setting the stage for further exploration of CLT by looking at the dynamic between Complexity and Clarity.

With a few basic principles of physics and network analysis under their belt, the stakeholder team began the process of revealing the Complex system they were embedded in. The Complexity ∞ Clarity dynamic, like the others, is like a mobius strip – Complexity giving way to Clarity that suddenly turns back on itself and ends up in Complexity again. Unlike fixed solutions to problems Clarity exists for a period of time and then fades back into the Complex tangle of the system.

But Clarity re-emerges, sometimes when you least expect it. Our analysis began by mapping the system from the perspective of all stakeholders. This produced a wall of maps. The system seen by the leadership team was simple, had only three moving parts and clearly displayed their removal from the work being done. Internal stakeholder maps (company marketing teams) had up to 20 moving parts and feedback loops. Where the systemic Complexity was revealed, however, was in the vendor maps. These had up to 50 elements, interconnections, interdependencies, and systemic rules, such as:

  • When a change is made at point G go back to point C and start again.
  • If a hand-off from Vendor X is delayed cancel work to this point and wait.
  • If a customer response is negative, stop everything until it is straightened out.

The wall walk by the stakeholder team was sobering and enlightening – the Complexity of the system visible for the first time, creating murmurs of “You do all that,” “Why are these two connected?” and “No wonder things are falling through the cracks!” Using the systems diagrams as a roadmap, the team found Clarity with support from other VUCA Prime elements:

  • What is the purpose of this system? Vision
  • What are we really trying to do here? Understanding

As Clarity emerged levers, redundancies, unnecessary loops, and bottlenecks were seen and changed. Over time, and many iterations of Complexity ∞ Clarity, the system was redesigned to improve information and product flow.

Lessons for Leaders

  • “A system is anything that talks to itself.” Kevin Kelly, in Out of Control. Look for ways that the organization can talk about the Complexity you face. In conversation Clarity emerges.
  • Go slow at the beginning so you can go fast at the end. This adage from decision analysis is a mantra for the Complexity ∞ Clarity dynamic. Clarity only emerges when you take time to see into the Complexity, find the levers, and shake out the knots. Stop fire fighting long enough to sense the whole system, test your hypothesis, and adapt to what you are learning.
  • What you see is the reality you know. To find Clarity you have to see the parts and the whole, the trees and the forest. As you “expand reality” you increase your ability to act.

 

 

Next Blog Post

Leading the dynamic between Ambiguity and Agility.

Dr. Carol Mase

Carol@CairnConsultants.com

Carol challenges leaders and their organizations to think differently about the world and how they can achieve their fullest potential in it. Her unique background unites business and biology, psychology and physics, bringing them into creative tension and generating tools and applications for all levels of the organization – from the C-Suite to the manufacturing floor. Carol has worked as an entrepreneur and an executive in Fortune 500 companies, always introducing fresh ideas that produce innovation and change, locally and organization-wide. She holds a degree in Psychology/Education, a Masters in Human Ecology/Interpersonal Relations, and a Doctorate in Veterinary Medicine.


[i] Mary Uhl-Bien and Russ Marion (eds), Complexity Leadership, Information Age Publishing, Charlotte, North Carolina, 2008. Stephan Haeckel, Adaptive Enterprises, Harvard Business School Press, Boston MA, 1999. J. Goldstein, JK Hazy, and BB Lichtenstein, Complexity and the Nexus of Leadership, Palgrave Macmillian, NY, NY, 2010. Margaret Wheatley, Leadership and the New Science, Barrett-Koehler, San Francisco, CA, 1994.

 

Key Questions to Ask Before Selecting a Solution to a Business Problem

Employee raising hand for asking question at conference in office boardroom

At the heart of every Quality Improvement Initiative lays a solution to a problem. However blatantly obvious this sounds, business improvement practitioners will be the first to admit the process of selecting, applying and measuring the impact of solutions can be a daunting task itself. You don’t always get the luxury of selecting a “no brainer” solution to close improvement gaps.

It’s well accepted that most problem solving methodologies involve 6 generic steps in the Cycle of Improvement.

Step 1. Defining the problem

Step 2. Defining the desired Outcome

Step 3. Generating Ideas as Solutions

Step 4. Implementing a Solution

Step 5. Measuring the Impact of the Solution

Step 6. Reviewing / Adjusting / Optimising the Solution

Step 4 is the real “show stopper” and determines whether all the efforts put into the solution will bear any fruit.

If trial and error is at one end of the solution selection scale, how do you go about choosing the most appropriate solution to implement, test and measure the impact, from a collection of ideas or a brainstorm?

Most selection techniques revolve around a type of priority grid. In its simplest form, The priority grid can be represented by a Pain vs Gain grid, where improvement solutions are placed on a chart with 2 axes, one showing the Pain or Effort scale (Easy to Difficulty to implement) and one showing the Gain or Benefit scale (High benefit to Low benefit). The quadrant of choice, no prizes for guessing, is the Low Pain, High Gain quadrant.

There are however, a lot more considerations that should be taken into account when selecting a solution for implementation.

The Key Questions To ask Before Deciding a Solution to Implement.

  • Does the solution meet Customers’ Requirements?
  • Is it aligned to the Business Strategy / Mission and Values /
  • What Impact will this have on the business now ?
  • What is Potential Impact the solution have in the future ?
  • What Business Benefit does the solution bring? – This is one where you need to strike a balance between tangible and non-tangible ideas in order to get everybody on board. The difference between these categories are that tangible ideas will lead to a financial improvement whilst non-tangible suggestions contain a non-monetary aspect. But this doesn’t mean they are not important, as often this intrinsically contributes a lot to the well-feeling and being of employees.
  • Does the solution directly impact one of the KPI’s ?
  • How much Time will it take to implement solution ?
  • What is the Urgency in implementing this solution ?
  • What Investment and resources are required? / How much will the solution Cost ?
  • What is the Payback (in years) for this investment ?
  • What is the Value of the solution ?
  • What Authority will be needed to approve the solution ?
  • How Complex is the solution ?

It goes without saying that some of these questions may not be applicable to every type of solution you’re considering and should be therefore be used as a generic guide.

It’s also good practice to create a kind of scoring system for each of the answers based long the lines of

  • 0 = No / None / Nil evidence
  • 1 = Somewhat positive evidence
  • 2 = Significant evidence
  • 3 = Definite Yes.

By tallying up the individual scores for each question to a proposed solution, you start to get a feel of who’s likely to top the “billboard charts”.

Armed with this prioritisation matrix, select your best solution , put it to test and measure, measure, measure.

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For more resources, see our Library topic Quality Management.
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This technique was first supported by immigration solicitors milton keynes