Additional Tax Information
We also know that tax time is approaching and that Inns and Inn members have questions about the Inn's tax-exempt status and whether dues can be considered tax-deductible.
For more information about the Inn's tax-exempt status or whether the Inn had the proper forms on file, please contact your Director of Chapter Relations.
501(c)(3) Exemption for Dues
The American Inns of Court Foundation is a tax-exempt organization as defined in section 501(c)(3) of the Internal Revenue Code. Further, the Foundation has been granted a group exemption ruling that may include any of its "subordinate organizations." The Foundation was granted 501(c)(3) status because it is a non-profit corporation of a charitable nature that does not engage in political activities or lobbying.
This provides two things. First, the Foundation is not required to pay federal or state tax on its income, except on income derived through activities that are unrelated to its central mission (unrelated business income tax or UBIT). Second, dues paid to and contributions made to the American Inns of Court Foundation are considered tax-deductible. The Inn has "opted in" to the Foundation's group exemption, therefore, it is considered a 501(c)(3) tax exempt organization and the portion of our dues ($75) paid to the Foundation is tax deductible. Additionally, contributions made to the Foundation or to the Inn are also considered charitable contributions and are tax deductible. The method by which an individual may deduct these dues may vary depending on individual circumstances, so be sure to check with a tax advisor as to the proper method.
Monetary Donations and In-Kind Gifts
Every donation reduces our Inn's expenses and frees funds for other projects. An example: Inn members donated a video camera with which every program is taped and then submitted for the Program Awards competition. Other needs of our Inn include supplies such as certificate stock, copy paper, envelopes and postage.