For-Profit and Nonprofit Joint Ventures in Tough Economic Times

In a time of economic upheaval, nonprofits everywhere are struggling for new sources of funding and expense sharing. Simultaneously, the nonprofit sector has seen a growth in “social enterprises” - businesses designed not just to make a profit, but to further social goals. Given these two trends, more and more nonprofits find themselves considering for-profit activities such as joint ventures. This OnDemand Webinar will cover the basic tax issues of for-profit/nonprofit joint ventures, IRS pronouncements and court cases to date, and some drafting tips and practical issues that may arise in forming a joint venture.

Authors

Agenda

Exemption Issues

• Organizational and Operational Tests
• Private Inurement and Private Benefit
• Plumstead Theater and For-Profit Activities

UBTI Issues

• General Background
• UBTI Taxation of Partnerships, S. Corp. and Dividends

Revenue Ruling 98-15: The Good, the Bad and the Ugly

• Background: Whole Hospital Joint Ventures Versus Ancillary Joint Ventures
• The Good Example
• The Bad Example

St. David's, Redlands and Other Guidelines

• Redlands
• St. David's
• Educational Rulings and Ancillary Joint Ventures

Practical Issues and Drafting

• Purpose Statement in the Joint Venture
• Board Control
• Management Agreements
• Debt Structures And Liabilities
• Other Traps

Additional Formats