Law Commons^™

Charity Disparity: The Challenge Of Applying Religious Law On Zakāt In The United States, Ahmed E. Taha, Sohaib I. Khan

Northwestern Journal of Law & Social Policy

No abstract provided.

Rejecting Charity: Why The Irs Denies Tax Exemption To 501(C)(3) Applicants, Terri Lynn Helge

Terri L. Helge

New charitable organizations generally must file an application for exemption (Form 1023) and await approval from the Internal Revenue Service. Unfortunately, the criteria the Internal Revenue Service uses to evaluate applications has not always been transparent. If an application is approved, the Internal Revenue Service determination letter and the application for exemption are required to be made publicly available and can be requested from the Internal Revenue Service or the organization itself. Prior to 2004, in the case of denials, neither the application nor the Internal Revenue Service’s correspondence setting forth its rationale for the denial were made publicly available. …

The Natural Property Rights Straitjacket: The Takings Clause, Taxation, And Excessive Rigidity, Eric Kades

Faculty Publications

Natural property rights theories have become the primary lens through which conservative jurists and scholars view the Constitution’s main property rights provision, the Takings Clause. One of their most striking arguments is that progressive income taxation — applying higher tax rates to higher incomes — is an unconstitutional taking of wealthy taxpayers’ property. This has become part and parcel of well-established battle lines between conservative property rights advocates and their liberal counterparts. What has gone unnoticed is that the very same argument deployed against progressive taxation also deems regressive taxation — applying lower tax rates to higher incomes — an …

Some Implications Of The Agency-Cost Theory Of The Nonprofit Firm, Benjamin Leff

Contributions to Books

Social enterprises are business enterprises that seek to pursue social goals. In order to do that, they need to be able to make binding commitments to a variety of stakeholders that they will indeed pursue such goals. At least since Henry Hansmann wrote his seminal works on nonprofit organizations in the early nineteen eighties, it has been widely understood that a significant value of the nonprofit organizational structure is the ability of the "nondistribution constraint" to serve as just such a commitment mechanism. In the case of for-profit social enterprises, where the nondistribution constraint does not apply, what mechanisms might …

The Boundary Between The Not-For-Profit And Business Sectors: Social Enterprise And Hybrid Models, Benjamin Leff

Contributions to Books

It is conventional to think of not-for-profit organizations as inhabiting a sector distinct from the private business sector on one side and the government sector on the other. One of the traditional goals of law in the nonprofit sector has been to distinguish entities in the nonprofit sector from those in the business sector--to define and police the boundary, both so governmental benefits can be provided to not-for-profit entities and so stakeholders can understand which organizations are bound by the nondistribution constraint. Therefore, when there are legal reforms that complicate or alter the boundary, these reforms should be evaluated not …

Charitable Subsidies And Nonprofit Governance: Comparing The Charitable Deduction With The Exemption For Endowment Income, David M. Schizer

Faculty Scholarship

Charitable subsidies are supposed to encourage positive externalities from charity. In principle, the government can pursue this goal by evaluating specific charitable initiatives and deciding how much each should receive. Although the government sometimes makes this sort of fine-grained judgment, this Article focuses on two income tax rules that leave the government essentially no discretion about which charities to fund: the deduction for donations to charity ("the deduction") and the exemption of a charity's investment income ("the exemption"). With each subsidy, federal dollars flow automatically as long as charities satisfy very general criteria.

As a result, these subsidies are especially …