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View Diary: Class Warfare: 18 Families financed Estate Tax Repeal Campaign (300 comments)

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  •  There Are Laws About This, But (2+ / 0-)
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    drewfromct, CSI Bentonville

    They can make their kid the head of a charity if they want, but federal law prevents them from paying "excessive" compensation.  The law does not define what "excessive" is, but it does outline steps a charity must take to show that a salary is not excessive (the salary must be approved by an independent board or committee; comparative data must be used to ensure that the salary is reasonable; and the decision must be documented adequately).  There can be significant penalties to the organization and the individual for paying excessive compensation.  Excessive compensation is perhaps the biggest item in the charity arena that the IRS is looking at right now.  However, funding for the IRS' charities division has been cut significantly in recent years (big surprise), so many people can fly under the radar.  But I must add that the vast majority of charities are working very hard to do good work and don't pay their staffs nearly enough.

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