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Rotary Clubs are recognized by the Internal Revenue Service as social clubs and are classified for income tax purposes as 501(c)(4) and are not tax exempt. Many clubs have formed a club foundation, which is classified as a 501(c)(3), a Tax Exempt Organization. The Rotary club and the club foundation work together to accomplish their goals, the same way that Rotary International and the Rotary International Foundation work together. The club provides the manpower, and the club foundation provides the tax free structure.
Your Rotary club runs social programs, and your club foundations run the fundraisers. We now have this same partnership at the District level. The District Foundation is legally a separate organization from RI District 7510, but it is composed of active Rotarians from District 7510.
The New Jersey Rotary Capital District Foundation, referred to as the “District Foundation”, has four purposes:
First: To support the educational efforts of the District.
Second: To support the current Governor with any District fundraisers, outside the scope of The Rotary International Foundation.
Third: To support the District by holding funds for multi-year programs which span two or more Governors.
Fourth: To support clubs in our district which do not have their own club foundations.
First: District 7510 educational programs include but are not limited to the following programs: President Elect Training Seminar (PETS); District Assembly; District Conference; staff meetings; the College of Governors; Team Training of the AG's & Directors & Officers; Foundation Seminar; Membership Seminar; Interact Officer Training; Rotaract Officer Training; Presidents Meetings; and other district training programs. The District deposits adequate funds from the district dues into the Foundation account so the bills for the training programs may be paid. The District Treasurer collects the dues and forwards an appropriate amount to the Foundation Treasurer.
Second: Occasionally, a Governor will run a fundraiser for a cause separate from the Rotary International Foundation. One example is the dinner dance Governor Tulsi ran to raise funds for autism. This fundraiser would be handled through the District Foundation, saving taxes that would otherwise be paid for the same services.
Third: Since each Governor needs to shut down his account at the end of his year, it is appropriate to have an account to store funds for multi-year projects which span two or more Governors. The District Foundation can fill that need.
Fourth: Since some Rotary clubs do not have foundations, they can use the District Foundation for their fundraisers. However, club fundraisers using the District Foundation umbrella need to deposit collected funds in the District Foundation account, and then have funds withdrawn again to pay bills. This ensures that a "paper trail" exists, showing that all project revenues and expenses passed through the District Foundation. The IRS has the ability to do five year audits to confirm that we are acting properly, so this format must be strictly followed. Contact Treasurer PDG Andy Calamaras if you wish to discuss participation.
The District Foundation must be notified whenever its Tax Exempt Number is being used, even if it is not for fundraising purposes. One example is that Union County required The Rotary Club of Mountainside to have a 501(c)(3) Tax Exempt Number in order to use the County Park for a social event. Please inform Chair PDG Dr. Michael Hart firstname.lastname@example.org.
Checks for deposit should be clearly marked with the source of the funds, such as District 7510, or the Rotary club's name, and the project or purpose of the deposit.
The District Foundation cannot make collection efforts. Collections need to be made by the respective clubs, or the appropriate District official.
The District Foundation can provide a document- the NJ Form ST-5 - which exempts vendors from collecting NJ state sales tax.
The District Foundation may not be involved in political activities or political campaigns in any way.
The requesting Club or agency submits a letter request to use the District Foundation, along with an application form. There is a separate letter for Rotary Clubs and another for all other agencies, such as Interact, Rotaract, District 7510, etc. The forms are at the bottom of this page.
Chair: PDG Dr. D. Michael Hart
Vice Chair: PDG Hal Daumé
Secretary: David Frantz, Esq., CPA
Treasurer: PDG Andy Calamaras
Member: District Governor Charles Minton
The sitting District Governor is appointed to a 2 year term, one year as Governor and one year as immediate Past District Governor. The 3 other members are appointed to 3 year terms, which may be renewed. All Board members must be active Rotarians in District 7510.
The idea of a District Foundation was proposed by PDG Michael Hart at a College of Governors meeting in 2011 near the end of DG Ahmed Azmy’s year. The project spilled over into the beginning of DG Megan Jones-Holt’s year, and she approved it as well. PDG Michael Hart formed a committee with PDG Andy Calamaras and Westfield attorney Barbara Doyle-Frantz, and they applied to the IRS for a tax ID number in the fall of 2012. The financing came from the excess funds from Ahmed’s year.
The IRS became embroiled in some political problems, resulting in a long delay, with no word coming from them for several years.
The IRS finally approved our application on April 8, 2014. The New Jersey Department of the Treasury also approved our tax exempt status.
The first Board of Trustees consisted of PDG Ahmed Azmy, DG Megan Jones-Holt, PDG Michael Hart, PDG Andy Calamaras, and Barbara Doyle-Frantz, Esq.
Other Governors who have served on the board are: PDG Dwight Leeper, PDG Tulsi Maharjan, PDG Mel Kevoe, PDG Hal Daumé, DG Charles Minton.
For any questions, please contact PDG Dr. D. Michael Hart.
Please mail checks to Treasurer PDG Andy Calamaras, 232 N. Martine Ave, Fanwood, NJ, 07023. Make checks payable to "NJ Rotary Capital District Foundation."
PDG Andy Calamaras is available to come to your club as a speaker if you wish to explore this topic further. Contact PDG Andy or phone 908-322-2350.