Page 318 - Washington Nonprofit Handbook 2018 Edition

APPENDIX B

Glossary

“At Will” Employment
An employment status which is presumed in Washington State unless
otherwise agreed upon by the employer and employee. The “at will”
employment relationship means that an employee may resign at any time for
any reason and, likewise, the employer may discharge the employee at any
time for any reason.

1980 United States-Canada Income Tax Convention
Commonly referred to as the “Convention”, this treaty provides for reciprocal
recognition of exemption for religious, scientific, literary, educational or
charitable organizations under limited certain circumstances. As such, exempt
organizations in either Canada or the U.S. must automatically receive

recognition of exemption without application in the other country.

1992 United States-Mexico Income Tax Treaty
Otherwise known as the “Treaty”, this agreement provides for reciprocal
recognition of exemption and reciprocal deduction of charitable contributions,
subject to limitations to the income arising in the other country.

501(c)(3) Organization
An entity that is exempt from federal income tax under section 501(c)(3) of Title
26 of the United States Code (Internal Revenue Code of 1986, as amended).
501(c)(3) organizations are the most common of the 29 types of 501(c)
nonprofit organizations in the U.S.

Articles of Incorporation
The document filed with the Secretary of State (in Washington State) to create
a corporation.

Board of Directors
The governing body of a nonprofit corporation; sometimes called the Board of
Trustees.

Business and Occupation Tax
A tax imposed on the state and city level on the gross receipts of every person
engaged in business activities. While nonprofit organizations are not exempt
from such tax obligations, some specific exemptions and deductions may be

WASHINGTON NONPROFIT HANDBOOK -307- 2018