Kirk A. Hoopingarner quoted in article “The Downside of Joining a Nonprofit Board”Wall Street Journal 10/10/14
Below is an excerpt:
One of the biggest financial risks that board members can face is when the nonprofit doesn’t properly pay payroll taxes for its employees, says Kirk Hoopingarner, a partner at law firm Quarles & Brady in Chicago, which works with many nonprofits.
When that happens, for example, the Internal Revenue Service may hold the board negligent. Board members also may be held personally liable if the organization goes bankrupt and ends up not having the sufficient funds to pay outstanding payroll taxes, he says.
A board member could also face personal liability if he or she is directly involved in a decision to terminate an employee who later alleges that the termination was discriminatory, he says.
Given these risks, advisers should encourage clients to conduct due diligence on the board they’re being asked to join, Mr. Hoopingarner says.