Update on bill requiring charity audits

In a blog entry from last week, a number of significant concerns about Sen. Eltife’s SB 1215 were raised.

The substitute bill voted out of committee is substantially different from the version originally filed. Where the original bill called for audits of all charitable corporations with $250,000 or more of revenues, the substitute calls for reviews for charitable corporations with revenues of at least $500,000 but less than $750,000 and audits for entities with revenues of $750,000 or over. While the penalties remain severe (still up to $1,000 per day) they no longer apply to small organizations that are not required to have reviews or audits. The requirement for an audit committee was also eliminated.

TSCPA met with Sen. Eltife’s staff, the Attorney General’s staff and Rep. Hughes (R-Mineola), the author of the House companion bill, HB 3417. We also testified at the House Business and Industry committee hearing on Tuesday. All parties were very accommodating and we now have a good opportunity to get some changes made to improve the bill.

Click here to read the committee substitute for SB 1215.

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2 Responses to Update on bill requiring charity audits

  1. Bob Owen says:

    The charity audit bill does NOT apply to churches, nor most other nonprofit organizations that are not charities, such as membership organizations, alumnae associations, etc. There are specific exclusions of churches already in the law that this bill is amending. this bill does not change the exclusions section of the law.

  2. Terry Hobbs says:

    Based on what I have read on SB1215, this bill will apply to most churches in Texas, as they are mostly set up as Non-Profit Corporations. This could have very negative implications.

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