Page 321 - Washington Nonprofit Handbook 2018 Edition

Excess Benefit Transaction
A transaction in which an economic benefit is provided by a 501(c)(3) or
501(c)(4) organization, either directly or indirectly, to a disqualified person and
that value is determined to be in excess of the value of the services or property
received in exchange.

Excise Tax
A tax that applies to a specific type of income, activity, good, or service. These
taxes may also be imposed in response to the engagement in prohibited
activities.

Exempt and Nonexempt Employees
The Fair Labor Standards Act and Washington Minimum Wage Act regulate the
hours and wages of workers in Washington State. Work beyond 40 hours per
week must be compensated at a minimum of one and one-half times the
employee’s regular rate of pay for each hour worked. To avoid confusion,

employees should generally be assumed to be non-exempt from such
requirements unless they meet the qualifications for exemption set forth by
the U.S. Department of Labor.

Fair Use
The right to use the intellectual property protected by trademarks or
copyrights for certain qualifying entities or professionals. Nonprofit status
does not entitle an organization to assert fair use claims.

Feasibility Study
A study used to determine whether an idea has the support, commitment, and
resources to succeed as a nonprofit organization. Also used to describe a
blueprint for an organization’s capital campaign.

Fiscal Sponsorship
A cooperative relationship between a tax-exempt entity (the sponsor) and a
project which has not secured tax-exempt status (the sponsored organization).
In a fiscal sponsorship, the tax-exempt organization agrees to receive and
disperse funds for the project, often in exchange for fees or other benefits.

Form 990
The federal informational return which most 501(c)(3) organizations must file
annually with the IRS. The type of form required varies depending on the size
and type of the organization.

WASHINGTON NONPROFIT HANDBOOK -310- 2018