Set two charities' purpose and dissolution clauses side by side
Key facts
- Human involvement
- RedLawyer-led
- How AI is used
- Quote each organisation's purpose clause and its dissolution clause, and note whether the dissolution clause names members or shareholders as recipients. Write no merger paper, no plan of merger, and no amended article.
- What the lawyer must review
- You write the paper and any plan or amendment. Treasury Regulation § 1.501(c)(3)-1(b)(4) provides that an organisation is not organised exclusively for one or more exempt purposes unless its assets are dedicated to an exempt purpose. Assets will be considered dedicated, for example, if upon dissolution they would, by reason of a provision in the articles or by operation of law, be distributed for one or more exempt purposes, or to the federal government, or to a state or local government for a public purpose, or by a court to another organisation to be used as the court judges will best accomplish the dissolved organisation's general purposes. An organisation does not meet the organisational test if its articles, or the law of the state in which it was created, provide that its assets would upon dissolution be distributed to its members or shareholders. Section 1.501(c)(3)-1(b)(5) provides that the law of the state of creation controls construction of the articles. No state nonprofit merger statute was opened, so the corporate steps of a combination are not supplied by this comparison.
- Written for / version
- United States versionUS
Who does what
| Role | What they do |
|---|---|
| Assistance | Supporting preparation only. Limit any support to organising, indexing or comparing the source material. Confirm the tool’s capability and permitted scope. The tool writes nothing into the document. Substantive advice, judgement and any restricted content remain with the responsible human. |
| Lawyer | Perform the substantive analysis and decisions. Independently check any permitted supporting work and approve the exact output for its intended use. |
Checklist
- Review operative clauses in the complete document, including definitions, cross-references, schedules and inconsistencies with the instructions.
- Verify the applicable jurisdiction and the version of each relevant law, rule or instrument in force at the material time.
- Confirm the output against the client’s instructions and the complete relevant source material, including omissions or contradictions.
- Resolve exceptions and record the responsible lawyer’s approval of the exact output and intended use.