Kaboom! not registered with state as a charity
Organization has yet to obtain
nonprofit status as required by law
FARRAH MAFFAI The fireworks display on the Navesink River was as spectacular as ever this year on July 3.
If you donated money to Kaboom! this year, don’t try to deduct it from your taxes.
Kaboom!, also known as Fireworks on the Navesink, is not yet registered with the N.J. Division of Consumer Affairs and is not registered as a 501(c)(3) nonprofit corporation with the federal government.
Registering with the state is a requirement for any organization soliciting donations from the general public, and failure to register can result in civil penalties against an organization that has not properly filed with the state.
No criminal charge is specified in the state’s statutes regarding charities that fail to properly register as a nonprofit.
Chris Braun, the recently appointed committee chairman, said that the failure to register was not intentional and that the organization is in the process of filing for tax-deductible status.
"The committee members are unpaid. In fact, we all take time from our careers for this," he said.
The committee, which organizes and oversees an annual fireworks display over the Navesink River, is not a committee of the borough’s municipal government. The fireworks display has not been under the borough’s control since 1987, when the borough’s parks and recreation department ended its involvement.
"It’s unfortunate that people think this is a borough function," said Braun.
"The borough participates as far as logistically handling the police and authorizing the fireworks, but this committee has operated on an ad hoc basis for probably 15 years," said Mayor Edward J. McKenna Jr., who was recently enlisted by the organization to help it officially incorporate with the state and seek nonprofit status with the Internal Revenue Service.
The organization has established a target of $150,000 a year over the last few years to cover the costs incurred in putting on the fireworks display.
Braun said the committee has had a budget shortfall over the last few years.
The organization issued a statement a few weeks ago, saying that it had just finished paying off the costs of putting on last year’s display.
McKenna said there is a long process of applying for nonprofit status with the IRS, and getting that designation could take up to nine months.
Registering with the state, which costs less than $100, is part of the process in becoming a 501(c)(3) nonprofit corporation. It is possible to register with the state without registering with the IRS.
Because Kaboom! is not registered as a 501(c)(3), donations made to it are not tax-deductible.
"I don’t know what representations have been made to anybody concerning deductibility," said McKenna.
A flier published by Kaboom! asks readers to "please give generously" to the fireworks fund and makes no assertion of tax deductibility for sending a contribution.
However, in the section of the flier that urges people to sign up for the "special VIP area," the same flier states that the donation for seating is "$200 per adult, $75 per child, and is tax deductible."
McKenna said he did not know if there was a difference between the general donations and the VIP ticket package.
In a previous interview, McKenna said, "The committee has never held themselves out as a charity. They’re just soliciting funds to help put on the fireworks. I gave money year after year, and I never deducted it."
According to state law, a charity is defined as either a corporation that is tax exempt under IRS code 501(c)(3) or "any person who is, or holds himself out to be, established for any benevolent, philanthropic, humane, social welfare, public health, or other eleemosynary purpose, or for the benefit of law enforcement personnel, firefighters or other persons who protect the public safety, or any person who in any manner employs a charitable appeal as the basis of any solicitation, or an appeal which has a tendency to suggest there is a charitable purpose to any such solicitation."
In addition to soliciting money from the public, Kaboom! has enlisted support of several businesses, including PNC Bank, Riverview Medical Center, Avante Nursing Home, and Verizon.
The initial interview with Braun took place before the Hub was aware of the organization’s claim of tax deductibility for the VIP seating. In a follow-up conversation he declined to comment on the information in the flyer. He also declined to name the organization’s accountant referring the question to McKenna.
The mayor said he did not know who the organization’s accountant is.