Nonprofit Board Members – To Pay or Not to Pay in 2018?

by Linda M. Lampkin, Senior Nonprofit Compensation Specialist 8. May 2018 05:15
The vast majority of members of boards of directors in the nonprofit sector are not paid for their services. Board members typically serve on a part-time, voluntary basis, and many in the sector feel that they should not benefit personally from their service. While board members do fall under the IRS prohibition on “self-dealing,” there is an exception made for “payment of compensation ... for personal services,” which includes fees for board members. Payments, however, must be “reasonable and necessary to carry out the exempt purposes” and “not excessive.” So, compensation is permitted – but it cannot be “unreasonable” and “excessive.” [More]

Tax Reform Hits Compensation of Nonprofit Executives in 2018

by Linda M. Lampkin, Senior Nonprofit Compensation Specialist 24. January 2018 12:21
Effective January 1, 2018, the Tax Cuts and Jobs Act, otherwise known as the Tax Reform bill, imposes a new 21% excise tax on nonprofits that pay compensation of $1 million or more to any of their five highest-paid employees. There will also be a tax on certain employee benefits. [More]

How Many Charity CEOs Will Earn $1 Million or More in 2018?

by Linda M. Lampkin, Senior Nonprofit Compensation Specialist 27. December 2017 12:26
A Wall Street Journal study published in March 2017 found that around 2,700 employees of 501(c)(3) nonprofits received annual compensation of more than $1 million in 2014. In 2011, a similar study found that about 2,000 were paid at this salary level, so the number increased about 30% over the three years. The number of employees receiving compensation in excess of $1 million will probably increase significantly in 2018. [More]

Attracting Nonprofit Executives in a Tight Labor Market

by Linda M. Lampkin, Senior Nonprofit Compensation Specialist 12. September 2017 07:52
With the US unemployment rate at a little over 4%, considered "full employment" by some economists, there is increasing competition between the nonprofit and for-profit sectors for employees. The for-profit companies are also being much more aggressive about promoting the social aspect of employment as a recruiting technique. Employees seeking a mission, the traditional nonprofit talent pool for nonprofits, can now find jobs in for-profit companies that may offer what they want – some paid hours for volunteering, a company commitment to a cause, etc. [More]

How to Determine the Salary for a Nonprofit Executive

by Linda M. Lampkin, Senior Nonprofit Compensation Specialist 17. July 2017 08:07
All salary negotiations need to begin with research—both employer and employee need to collect meaningful data, not just anecdotes, about typical pay for genuinely comparable positions before beginning compensation discussions. This approach not only makes sense for employers and the executives—it is what the IRS and charity regulators require. [More]

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