Southwest District Kiwanis Foundation

The Southwest District Kiwanis Foundation maintains a tax exempt 501(c)(3) status as a charitable organization under the rules of the Internal Revenue Service.  According to the IRS web site, qualifications to obtain this status include the following:

"To be tax-exempt under section 501(c)(3) of the Internal Revenue Code, an organization must be organized and operated exclusively for exempt purposes set forth in section 501(c)(3), and none of its earnings may inure to any private shareholder or individual. In addition, it may not be an action organization, i.e., it may not attempt to influence legislation as a substantial part of its activities and it may not participate in any campaign activity for or against political candidates.

Organizations described in section 501(c)(3) are commonly referred to as charitable organizations. Organizations described in section 501(c)(3), other than testing for public safety organizations, are eligible to receive tax-deductible contributions in accordance with Code section 170.

The organization must not be organized or operated for the benefit of private interests, and no part of a section 501(c)(3) organization's net earnings may inure to the benefit of any private shareholder or individual. If the organization engages in an excess benefit transaction with a person having substantial influence over the organization, an excise tax may be imposed on the person and any organization managers agreeing to the transaction.

Section 501(c)(3) organizations are restricted in how much political and legislative (lobbying) activities they may conduct. "

The Southwest District Kiwanis Foundation (SWDKF) went through the qualification process and was approved by the I.R.S.  We also sought the ability to provide this same 501(c)(3) tax exempt status to Kiwanis Club Foundations within the Southwest District who did not want to go to the trouble or expense of obtaining it through the Internal Revenue Service themselves.  This was also approved by the I.R.S.

The SWDKF now covers more than half of the individual Kiwanis Club Foundations within the Southwest District.  Those not covered either have their own independent approvals from the I.R.S. or they cannot legally offer tax exemptions for donations that they may receive.  Those Kiwanis Club Foundations that are covered under this "umbrella" coverage that the SWDKF provides MUST file the appropriate tax returns each year or face the possibility that the SWDKF will drop them from coverage.  The SWDKF will not risk losing its tax exempt status over the failure of one of its member club's failure to follow the rules.

For more information about what is required from each club, please  contact the foundation legal advisor- Pat Irvine at pirvine@fclaw.com.