State level

IRA Charitable Rollover

On March 4, the N.C. House of Representatives overwhelmingly approved an amendment to  a bill (S.20) that would have protected the state tax treatment of charitable contributions that seniors make from their individual retirement accounts (IRAs). Thanks to Rep. Rick Catlin (R-New Hanover) for sponsoring the amendment, which passed by a 109-7 vote.

Unemployment Laws and Nonprofits

Unemployment insurance is an important part of the social safety net that helps workers who have been laid off or terminated without cause to transition into new jobs by providing them with limited, temporary financial assistance. The Division of Employment Security at the NC Department of Commerce manages North Carolina’s unemployment system.

Here is some basic information about how the state’s unemployment system affects nonprofits.

Workers' Compensation Changes for Small Nonprofits

At the Center’s recommendation, both the House and Senate included a provision in their regulatory reform bills that could save money for many small nonprofits with fewer than three employees. Under state law, any employer with three or more employees is required to purchase workers’ compensation insurance. The definition of “employee” in the current law includes nonprofit board officers, meaning that small nonprofits with three or more board officers (i.e. almost all nonprofits) are required to take on an often unnecessary expense.

Expanding Charitable Deduction Could Help Nonprofits and Businesses

In 2011, the N.C. House of Representatives overwhelmingly passed H.B. 886, which would bring the North Carolina corporate tax deduction for charitable contributions into conformance with federal law. This would help more small businesses contribute to nonprofits. The N.C. Center for Nonprofits encourages the N.C. Senate to pass this bill during the 2012 short session.

 

 

Worker Misclassification and Nonprofits

The N.C. General Assembly is considering a bill (H.B. 482) that would create new penalties for nonprofits and businesses that improperly classify their workers as independent contractors rather than employees. Nonprofits that misclassify their employees and fail to provide benefits such as workers’ compensation or unemployment insurance benefits could face fines ($1,000 per misclassified worker) and could be barred from state contracts for five years.

Suggestions for Employment Status to State Legislators

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Comments of David Heinen of the North Carolina Center for Nonprofits House Judiciary II Subcommittee on H.B. 482 – Tuesday, July 28, 2015

Thank you Mr. Chair.

On behalf of the North Carolina Center for Nonprofits, I wanted to bring to your attention a potential unintended consequence of the employee misclassification reform bill (H.B. 482) that could affect nonprofits. I was hoping the subcommittee would be amenable to a small clarifying change in a PCS.

Nonprofits and tax reform

The General Assembly is in the final stages of its efforts to restructure North Carolina's tax system.  The House and Senate are considering different version of legislation (H.B. 998) to lower tax rates and simplify the state tax system. It is essential that tax reform not harm nonprofits. Specifically: