NON FOR PROFIT--- ALLOWED OR AN INUREMENT?
A representative of a 501(c)(3) nonprofit organization, self-identified as Star1441, asks: Is it permissible to use organizational funds to pay $10,000 in funeral expenses for a dying family member, or does this constitute prohibited private benefit (inurement) under the law? This article outlines relevant legal principles, noting the need to distinguish between charitable purposes and private interests, and recommends cautious handling.
We are a 501 non for profit. A family asked us to pay for a funeral for a terminally ill member who will sadly soon pass away. Are we allowed ($10,000 ) , or is it an inurement, and prohibited? Thank you Star1441