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Tuesday, June 28, 2011

IRS Does Not Require Full Board to Adopt Policies

Posted by Armanino Nonprofit Team

Exempt organizations will no longer be required to get the full board of directors to adopt the whistleblower, conflict of interest, and other governance policies for the 2010 Form 990. The IRS will instead allow a committee of the full board to adopt the policy if the policy is adopted by the end of its tax year.

Congress and the IRS have stressed the need for more board engagement in the affairs of the organization. However, the IRS found that these governance questions were problematic for some exempt organizations since many boards delegate authority for those policies to a committee. The IRS plans to allow this change for the 2010 990 and revisions will be made to the 2011 990 instructions.

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