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name: nonprofit-compliance-summary language: en description: Generates a structured regulatory compliance summary for U.S. 501(c)(3) nonprofit organizations covering federal tax-exempt status, multi-state charitable registration, and governance. Use when conducting compliance audits, preparing for IRS or state AG examinations, onboarding to a nonprofit matter, or producing board-level compliance reports.

Nonprofit Compliance Summary

Produces a prioritized compliance assessment for charitable organizations across federal tax, state registration, and governance domains.

Prerequisites

Gather before starting:

1. Organizational docs — Articles of incorporation, bylaws, IRS determination letter
2. IRS filings — Forms 990/990-EZ/990-N (prior 3 years); Form 990-T if applicable
3. State filings — Charitable registration certificates and annual reports for all solicitation states
4. Governance records — Board minutes, conflict-of-interest disclosures, compensation approval records
5. Correspondence — IRS or state AG inquiry letters, audit notices, compliance warnings

Note any unavailable documents — qualify findings accordingly.

Output Structure

1. Executive Overview

• Overall status: Full Compliance / Minor Deficiencies / Significant Gaps
• Critical issues requiring immediate action
• Filing deadlines within next 90 days

2. Federal Tax Compliance

Area	Requirement	Status	Notes
Annual filing	990/990-EZ/990-N timely filed (3-year lookback)		Auto-revocation after 3 consecutive misses
Exempt purpose	Activities consistent with determination letter		Flag material program changes
UBI	990-T filed for unrelated business income		Apply substantially-related test
Private inurement	No prohibited insider benefit
Excess benefit	No IRC §4958 violations
Political activity	No campaign intervention
Lobbying	Within limits (substantial-part test or §501(h) election)
Contribution records	Written acknowledgments for gifts ≥ $250
Public charity status	Passes §509(a)(1)/(2) public support test		Flag private foundation risk

3. State Compliance (per Jurisdiction)

For each state where the organization solicits donations:

State	Registration	Annual Report Due	Fundraiser Reg.	Disclosure
[State]	Active / Expired / Not Filed	[Date]	N/A / Current / Missing	Web ✓/✗ · Materials ✓/✗

Flag states requiring pre-registration before any solicitation (including digital appeals).

4. Governance & Operations

Area	Standard	Status	Finding
Board composition	Minimum size; majority independent
Conflict of interest	Policy adopted; annual disclosures collected
Executive compensation	Rebuttable presumption: (1) independent approval, (2) comparability data, (3) contemporaneous documentation
Corporate records	Minutes, resolutions, financials maintained
Financial controls	Segregation of duties; audit commensurate with revenue
Joint ventures	Special compliance analysis conducted

5. Recommendations

Priority	Issue	Action Required	Deadline	Citation
Critical
High
Routine

Workflow

- [ ] Collect and inventory prerequisite documents
- [ ] Assess federal tax compliance (Section 2 table)
- [ ] Assess state registration for each solicitation state (Section 3 table)
- [ ] Assess governance and operations (Section 4 table)
- [ ] Draft executive overview with status rating
- [ ] Compile prioritized recommendations with deadlines and citations
- [ ] Mark uncertain citations with [VERIFY]

Critical Checks

• Revocation risk: 3+ consecutive missed 990 filings triggers automatic retroactive revocation — always flag this prominently
• Compensation: Never conclude reasonableness without all three rebuttable-presumption elements documented
• State solicitation: Apply multi-state analysis even for incidental solicitation; most states require registration before digital solicitation to residents
• Citations: Reference specific form numbers, filing dates, and statutory provisions (IRC §§ 501(c)(3), 4958, 6033; state statutes) for every finding
• Uncertain citations: Mark [VERIFY] for any citation not confirmed against source documents
• Audience: Write so non-lawyer board members understand fiduciary obligations; flag legal conclusions for counsel review