Community Empowerment Matters

Is your small business trying to spruce up your website by adding some new pictures? Want to raise money for your nonprofit by hosting a community movie night? Trying to update your marketing materials with a brand-new promotional video with cool background music? If so, you could be opening yourself up to potential copyright lawsuits and should read up on the doctrine of fair use! An important aspect of starting a small business or nonprofit is exposure, and as organizations work to market themselves and increase awareness of their goals and activities in the communities they serve, they could open themselves up to legal danger. Litigation is expensive, and the cost can be especially devastating to small businesses and nonprofits. In all promotional or informational materials (including brochures, flyers, websites, etc.), organizations need to be sure that they are legally protected from copyright infringement claims.   What is Fair Use? Fair use is a legal doctrine that permits

 Tax-exempt organizations typically rely on grants and donations to support their missions, but many nonprofit organizations explore alternative sources of revenue to maintain financial stability. For example, a school may rent out additional space in its building or sell advertisements in its bulletin, newspaper, or podcast. While some organizations generate income from activities that do not align with their mission, it may be crucial to prioritize earning funds to further execute the organization’s purpose. However, if an organization is not careful, this added income can potentially jeopardize the organization’s tax-exempt status. Generating income from activities unrelated to the organization’s purpose may be considered unrelated business income (“UBI”), and the income derived from it may be subject to an income tax referred to as unrelated business income tax (“UBIT”). The Internal Revenue Service (“IRS”) defines an activity as UBI if it is “(1) income from a trade or business,