What type of activities constitute self-dealing by a nonprofit organization?

In Washington, self-dealing by a nonprofit organization refers to transactions that unfairly benefit an individual associated with the organization, as opposed to benefiting the organization and its mission. This may include transactions between the organization and its officers, directors, or other key individuals or entities related to the organization. Some examples of self-dealing activities include borrowing money from the nonprofit’s assets to give to an officer or director, granting personal favors to officers or directors, or allowing an officer or director to use the nonprofit’s assets for personal benefit. Another example would be providing compensation or other benefits to individuals that are greater than fair market value in exchange for goods or services. In Washington, it is a violation of federal and state law for a nonprofit to engage in self-dealing activities, and penalties may include fines, revocation of an organization’s tax-exempt status, or even criminal prosecution of individuals involved in the activities. Therefore, it is important for all nonprofits to be aware of the laws surrounding self-dealing before engaging in any activities.

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What type of activities constitute self-dealing by a nonprofit organization?

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