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Charity TherapyAuthor: Jess Birken, MNM, JD
What if you could hang out with experienced nonprofit professionals and ask them your burning questions about the day-to-day life of nonprofits? What if you could take their wisdom and bring it back to your organization, for free? That's what we do on Charity Therapy. Hosted by Jess Birken - owner and lawyer at Birken Law Office. Every episode is an in-depth look at how to run a nonprofit, from fundraising to IRS woes to people problems and more! Our goal is to empower nonprofits to achieve your mission by doing things right. Language: en Genres: Business, Management, Non-Profit Contact email: Get it Feed URL: Get it iTunes ID: Get it Trailer: |
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152: That's Called Tax Fraud! | When an Entrepreneur has a "Really Good" Nonprofit Idea
Episode 152
Thursday, 27 November, 2025
You've got a great business idea, people want to donate to help, and you're thinking… "What if I just start a nonprofit?" Hold up — let's talk about it. In this episode, Meghan and I tackle one of the most common (and most frustrating) misconceptions out there — when entrepreneurs try to mix business ventures with nonprofit structures. Real Listener Question: "I'm coaching a small business owner who wants to restore a historic hotel, turn it into an Airbnb, and start a nonprofit to collect donations for the renovation. He says it's a win-win — is that legal?" This one had me fired up. We get into why turning your business dream into a "nonprofit project" is usually a fast track to tax fraud, how to tell when an idea crosses the line, and what to do instead. From historic preservation loopholes to optics in small towns, we unpack all the ways good intentions can turn into bad legal problems. If you've ever thought about forming a nonprofit to fund your own idea — listen to this first. What You'll Learn: Why the IRS cares about your "exempt purpose" more than your passion project How "good ideas" can become tax fraud with one wrong move What happens when your nonprofit owns your business asset Why perception matters just as much as legality Smarter, legal alternatives like crowdfunding and business partnerships How to know when a project is charitable — and when it's just creative entrepreneurship Bottom line: Not every good idea is a nonprofit idea. If your goal is to make money, serve customers, or grow your business, that's awesome — it just means you need a for-profit model, not a charitable one. Learn more about IRS exempt purposes: https://www.irs.gov/charities-non-profits/charitable-organizations/exempt-purposes-internal-revenue-code-section-501c3 Previous Episode: Can You Convert a Failing Business Into a Nonprofit? https://birkenlaw.com/charity-therapy-podcast/ct149/ Episode Transcript: https://birkenlaw.com/wp-content/uploads/2025/10/CT152_Transcript.pdf Connect with Us Jess Birken: https://www.linkedin.com/in/jessbirken/ Meghan Heitkamp: https://www.linkedin.com/in/meghan-heitkamp-829254115/ Listen & Engage Listen on Apple Podcasts | Spotify | YouTube | Amazon Music Rate & Review on Apple Podcasts: Click "Ratings and Reviews" then "Write a Review" Send us your nonprofit questions: https://birkenlaw.com/podcast/#podcast-story Stay Connected Sign up for the Birken Law Email list: https://birkenlaw.com/signup/ Follow us on Facebook, Instagram, Twitter
