Ryan Borden

State Advocate

StateAdvocate@IndianaKofC.org

Home Council : 17069 Fr. Timothy Sweeney, Bristow, IN

Home Assembly : 2065 Rev. Edward J. Heuke VF Assembly, Tell City

Worthy Brother,

This question was asked by a council member a few weeks ago, so I figured it would be good
for everyone to see the question plus the answer according to Supreme.

DISTRIBUTION OF FUNDS IF A COUNCIL IS SUSPENDED OR DISSOLVED
At its convention in 2014, the Supreme Council clarified the procedure to be used by all
Subordinate Units of the Knights of Columbus (i.e., state councils, local councils, assemblies,
chapters) to dispose of funds or property belonging to Subordinate Units in the event that such
Subordinate Units are suspended, dissolved or otherwise no longer exist.
In order to address this contingency, the Supreme Council adopted a resolution requiring
Subordinate Units to comply with the following:
In the event that it appears that a Subordinate Unit may be suspended, dissolved or may
otherwise no longer exist, prior to such suspension or dissolution, any residual funds or property
of such Subordinate Unit shall be distributed to a charitable organization designated under
Section 501(c)(3) of the Internal Revenue Code, or the equivalent designation in a non-United
States jurisdiction, the mission and identity of which is not inconsistent with the mission and
identity of Knights of Columbus and the teachings of the Catholic Church, with preference given
to a local parish church or school, Knights of Columbus Charities, Inc., Knights of Columbus
Charities USA, Inc., Knights of Columbus Canada Charities, Inc., the John Paul II Shrine and
Institute, Inc., or a state council charitable corporation.
Any such disposition shall be made in accordance with Section 122 of the Laws of the Knights
of Columbus.
For purposes of this resolution only, in the absence of Subordinate Unit by-laws establishing a
quorum for Subordinate Unit meetings, eight voting members shall be the quorum necessary for
a meeting at which Subordinate Unit approves any such disposition, provided however, that
notwithstanding whether the Subordinate Unit’s by-laws state otherwise, in the event there are
fewer than 15 voting members in the Subordinate Unit, then a simple majority of the voting
members will be sufficient to constitute a quorum for such purpose.
In accordance with Section 4 of the Charter of the Knights of Columbus, and Section 2 of the
Constitution of the Knights of Columbus, and subject to enforcement, including without
limitation, under Section 157.1 of the Laws of the Knights of Columbus, Subordinate Units shall
be governed by this resolution as a rule of the Order.
Rev. March 2019

GUIDELINES FOR CHARITABLE FUNDRAISERS
Members frequently have questions regarding the morality of contributing to a particular
charitable organization. The Knights of Columbus does not maintain a list of charitable
organizations that have been screened and approved for contributions by councils. A Knights of
Columbus council should consider contributing to organizations that have a mission that is
consistent with the principles of the Order and the tenets of the Catholic faith, including but not
limited to the following:
Established Knights of Columbus programs and partnerships, (e.g., American Wheelchair
Mission, Special Olympics, Habitat for Humanity, Coats for Kids, United in Charities, RSVP and
Vocations Programs, Ultrasound Initiative, Scouting, Catholic school scholarships, etc.);
Supreme Council charitable funds (e.g., Culture of Life Fund, United in Charity), which support
many worthwhile causes and good organizations;
The Catholic Church and related organizations, (e.g., Catholic charities, Catholic hospitals,
Bishops’ appeals, diocesan charities, local parish fundraisers, seminarian support, pro-life
activities, food pantries, soup kitchens, St. Vincent DePaul Society, mission societies, etc.); and,
Other national, regional, or local causes or organizations that have been traditionally associated
with the ideals and mission of the Knights of Columbus (e.g., veterans’ organizations, patriotic
organizations, local disaster relief, etc.).
In sum, the choice of a charity is a prudential judgment that is generally left to the sound
discretion of the members of the council. Members should exercise due diligence before
contributing funds to or partnering with any organization. Specifically, members should verify
that the organization’s identity and mission do not conflict with the teaching of the Catholic
Church. For this reason, the Knights of Columbus strongly recommends that members consult
with the bishop of their diocese or other competent authorities (such as the National Catholic
Bioethics Center https://www.ncbcenter.org/), regarding any questions of conscience.
In planning and conducting charitable fundraising events, councils should be guided by the
following principles:
Councils may use the name "Knights of Columbus" in conjunction with the charity fund-raiser, so
long as the individual council is clearly identified within the name, i.e., "Knights of Columbus
[Name of Council]Council No. 5748". The councils are not to use the name "Knights of
Columbus" standing alone.
Fund-raising activities should be used only to raise money for a worthy charitable organization,
consistent with the mission of the Order and our first principle of Charity. The beneficiary
organization should be identified in advertising for the event.
Proceeds from a charity fund-raiser cannot be used to pay for ordinary council expenses or
liabilities. The proceeds must be disbursed as follows:
Payment of the expenses associated with the event;
b. Gift to charitable organization.
Councils should obtain event insurance to cover all potential liabilities associated with the event.
If a council uses the services of a professional fund-raiser, event organizer, or similar entity,
such services should be obtained on a one-time basis. The council should not enter into a joint
venture with any company or organization.
Rev. February 2023

INVESTMENTS
In order to accomplish the charitable mission of the Knights of Columbus, councils routinely
raise money, which can then be donated to worthy causes. This mission also calls our members
to become personally involved in fundraising and charitable activities.
Although some councils maintain a large bank account or investment portfolio, we recommend
that councils conduct their financial affairs and charitable giving so that accumulated general
funds do not exceed $10,000. Larger and more active councils may maintain a larger balance in
order to cover the expenses for their activities. Also, some councils may exceed the
recommended $10,000 cap because of special circumstances, such as the receipt of a
restricted legacy gift or proceeds from the sale of home corporation property.
The recommended $10,000 cap on a council’s general fund is intended to avoid common
problems associated with the accumulation and investment of money. For example:
Investing and managing funds frequently causes discord and dissension among members who
may disagree about investment decisions.
Conflicts of interest frequently arise when members (or friends/relatives of members) in the
investment business seek to manage the funds.
The accumulation of large sums of money may lead members to handle those funds unwisely,
despite their good intentions.
Having access to a large amount of funds may be a temptation to self-dealing on the part of
some members.
Councils are authorized to receive funds into their general account in the course of ordinary
fraternal and charitable activities. To the extent that these funds are not immediately disbursed
for necessary expenses and charitable donations, they may be held in other bank and
investment accounts. However, councils should never invest or hold funds in brokerage
accounts, stocks, annuities, non-Catholic mutual funds (other than government money market
mutual funds), bonds, or other investments, such as gold, silver or platinum. Except under the
special circumstances described above, the Supreme Council does not advise, encourage,
recommend, or permit councils to invest or hold funds in any type of account other than the
following:
Ordinary short term certificates of deposit
Simple savings accounts
Simple checking accounts
Simple money market accounts
Government money market mutual funds
Mutual Funds including Knights of Columbus Mutual Funds
For example, councils may choose to place funds in excess of $10,000 in a short-term
certificate of deposit while waiting to disburse the excess funds for an intended purpose. It is
also acceptable for a council to hold excess funds in a certificate of deposit as a reserve to
cover a known expense or liability that is coming due in the future. The funds should be held
under the name and Tax Identification Number of the council, and only the officers identified in
the bylaws may have access to the account. The financial officers and trustees are responsible
for keeping the members informed of where the funds are deposited. A program or committee
chairman may never mix Knights of Columbus funds with personal funds.
In the event that a council receives proceeds from the sale of home corporation property, the
council is encouraged to honor the legacy of the brother Knights who acquired and maintained
the property over the long term. This can be done by investing in a diversified portfolio of
Catholic values investments (e.g., Knights of Columbus Mutual Funds) to pursue ongoing
charitable support in the name of the council.
Councils should not create charitable trusts. These types of trusts pose several challenges and
risks, including:
Reputational risk to the Order if the investments profit from activities inconsistent with Catholic
teaching.
Long-term commitment by members to select an appropriate investment advisor and manage
the principal.
Risk that successor trustees may not honor the original intention of the trust or have sufficient
experience and expertise to continue the investment program.
Separate tax-filing obligations, if the trust is formed as a separate entity, which is usually the
case.
Substantial legal obligations and risks for failure to comply.
Rather than forming charitable trusts, councils may consider other ways to distribute funds,
including:
A donor-advised fund established with Knights of Columbus Charitable Fund in the name of the
council
State council charitable foundations
Local Catholic schools
Other local faith-based organizations
Any individual member who expresses an interest in making a donation to an organization that
promotes faith-based initiatives should be encouraged to give to a donor-advised fund with
Knights of Columbus Charitable Fund, his state council’s foundation, or to the Supreme
Council’s United in Charity program. These donations are eligible for a tax deduction. Donations
to a council are not tax deductible.
Rev. January 2023

REINSTATEMENT OF TAX-EXEMPT STATUS OF COUNCILS AND ASSEMBLIES
The following information applies to US councils.
Councils and assemblies that have not filed a Form 990 for three consecutive years will
automatically have their tax-exempt status revoked by the IRS. If your council or assembly's
tax-exempt status is revoked, immediately fill out the Supreme Council EIN Authorization Form,
which may be obtained as a fillable PDF document by Supreme or Officer Desktop. Once you
have filled out this form, email it to tax.ein@kofc.org to request a reinstatement package. If you
have any questions, please email tax.ein@kofc.org.
*Unless otherwise expressly stated, the guidance set forth in the Officers’ Desk Reference does
not constitute tax advice on which any individual member of the Knights of Columbus or any
subordinate unit may rely in determining his or its obligations and liabilities under the revenue
laws of any jurisdiction. Council and assembly officers are responsible for ensuring compliance
with all applicable tax laws and regulations and the accuracy of all returns filed with any taxing
authority. To this end, we encourage all subordinate units to consult with a competent tax
advisor if they have any questions or concerns about their obligations and liabilities under the
revenue laws.
Rev. January 2020
Reviewed May 2021

Ryan Borden
Indiana State Council - Knights of Columbus
Indiana State Advocate
stateadvocate@indianakofc.org
webpage HERE
Vivat Jesus

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