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Nonprofit Law/IRS policy/ regulations for stipends to attend teaching events


In November I ran and was elected to be a delegate to a nation wide RA for education by my local union. In June, I was provided with the policy documents from my union regarding "Conventions, Conferences, and Other Events." Within this policy documentations it states:

under the heading of Disbursal (page 2)... [as typed] "#2. The portion of the stipend designated for meals will usually be distributed at the pre-convention meeting of the delegates." then it is penned in "This has been discontinued you have to request in writing to {the treasurer]"

I wrote to the treasurer but the board has concerns. I have not received several emails stating "Based on board email conversations we are aware there is a miscommunication in the documents you received." and they say that their are IRS concerns regarding stipends to be paid out for volunteers to go to teaching conventions and they are in the process of reworking this policy.

My questions are:
1) What are the IRS regulations regarding provision of stipends to attend such Conventions, Conferences and Other events?

2) What steps [forms to file or actions] are non-profits required to take for the sake of transparency within our organization?

3) What language should be included in policy to avoid further misconceptions?

The IRS rule for what nonprofits may spend money on is similar to
the standard that the IRS uses when determining what is a valid
business expense for an ordinary business. For example, at the IRS refers
extensively to the regular business expense rules and applies them
to 501(c)(3) organizations. Those rules would also apply to union organizations.

On page 32 we see "Reimbursements are
technically covered by Regs. 1.62-2.  However, for administrative
purposes, all TE/GE [Tax Exempt & Government Entities Division]
administrative personnel will treat reimbursements of a business
expense the same as if the expense were paid directly by the
employer, as long as the employee complies with the substantiation
See also: "Business Expenses"
on page 3, under "What Can I Deduct":
--start of excerpt  ---
To be deductible, a business expense must be
both ordinary and necessary. An ordinary ex-
pense is one that is common and accepted in
your industry. A necessary expense is one that
is helpful and appropriate for your trade or busi-
ness. An expense does not have to be indispen-
sable to be considered necessary.
--end of excerpt  ---

See page 41 of IRS Publication 535 at starting in the first
column under the heading "Accountable Plans" which the organization
must have.  That section is written for employees but also applies
to volunteers.
See the section under "Volunteer Officers/Workers" at
which is written specifically for Exempt Organizations and refers
to that Publication 535.
---Start of Excerpt--
A plan under which an employee or volunteer is reimbursed for
expenses or receives an allowance to cover expenses is an
accountable plan only if:

   *  There is a business connection for the expenses;
   *  The employee/volunteer adequately accounts for these
expenses within a reasonable period of time; and
   *   The employee/volunteer returns any amounts of excess
expenses within a reasonable period of time.
---End of Excerpt--

Details follow on from that page 41 of Publication 535.

and brochure:
--- Start of Excerpt ---
Recordkeeping by the Volunteer
•Reliable written record of any out-of- pocket expenses
•For any of expense of $250 or more

Statement from charity describing volunteer services

Statement from charity describing whether it provided goods or
services to volunteer

Reimbursing The Volunteer
• Volunteer - Maintain Accurate, Contemporaneous Written Records of
Expenses Reimbursed
• Charity - Not Responsible for Issuance of Forms 1099 for
Reimbursed Expenses
---End of Excerpt---
p17 - 18

Harvey Mechanic
Attorney at Law

P.S. This response is intended to be a general statement of law, should not be relied upon as legal advice and does not create an attorney/client relationship. For me to consider your individual situation and how the law applies, I would need to gather more information.

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Harvey Mechanic


I am an attorney and I volunteer time to answer general questions about U.S. Federal income tax issues of nonprofit 501(c)(3) public charities only. Those questions could be about establishing and maintaining legal requirements for such non-profit organizations in the United States, including Internal Revenue service filings and requirements. I will not be working on this free forum to answer questions about Nonprofit's possible unrelated or for-profit businesses or how to fill out forms. This forum is only for general questions about federal tax law, not as the law applies to your specific situation. If you do not make your question public then I will not be spending much of my donated time on answers that would not benefit the public. If you have other questions, please contact me at I will reply from my email. In any case, do not reveal confidential information to me until after I have contracted with you to provide personal legal services. My responses on this forum are intended to be general statements of law, should not be relied upon as legal advice, and do not create an attorney/client relationship. For me to consider your individual situation and how the law applies, I would need to gather extensive information about the situation. To search my previous answers you can do a Google search by "" without the quotes and then add your search terms before hitting enter.


I have been practicing law and especially the law of nonprofit organizations since 1990 when I was admitted to the New York Bar and I have maintained my status with the Bar since that time.


B.S. Columbia University in New York City, 1970

J.D. (Law Degree) Brooklyn Law School, 1990 -- Cum Laude.

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