American Civil Liberties Union (ACLU) Foundation

CharityWatch's rating of the ACLU Foundation is for the 501(c)(3) public charity (tax ID #13-6213516).

The rating does not include the financial activities of the local ACLU affiliates or of the affiliated 501(c)(4) tax-exempt, social welfare organization, the American Civil Liberties Union (ACLU) (tax ID #13-3871360). CharityWatch issues a separate rating for the ACLU.

CharityWatch separates the ratings for 501(c)(3) & 501(c)(4) organizations, even when they are included together in a consolidated audit, due to their differing treatments under the IRS tax code. For more information on this topic, please see our sections on Types of Non-Profits, Tax Status, and Treatment of Related Organizations, which can be found on the Our Process page.

For more information about things to consider when donating to organizations that have related public charity and social welfare entities, read "Sorting Out Nonprofit Pairs" in the "Articles & Alerts" section, below.

According to the ACLU Foundation consolidated audit of March 31, 2020 (Note 1, Organization):

"Both the ACLU Foundation and the Union [the ACLU] are affiliated with 50 nonprofit, tax-exempt organizations in every state in the United States, the District of Columbia and Puerto Rico. All affiliates include reference to the American Civil Liberties Union or some variation thereof in their names (the affiliates). The affiliates also operate through related Section 501(c)(3) and Section 501(c)(4) organizations. The affiliates share the same overall mission and purpose as the ACLU, but their programs focus more on local or regional issues, while the ACLU's program activities are focused on overarching civil liberties issues and initiatives. Although the ACLU plays no direct role in the governance of and, except in very limited instances, does not share employees with, the affiliates, the organizations jointly fundraise and work together on certain programs and the ACLU, through either the Union [the ACLU] or the ACLU Foundation, as appropriate, at its sole discretion provides targeted financial and other support to the affiliates."

"The accounts and activities of the Union and the affiliates are not included in these [audited] consolidated financial statements," according to Note 2 of the ACLU Foundation consolidated audit of March 31, 2020.

According to the ACLU Foundation audited Consolidated Statement of Activities for the year ended March 31, 2020, the Foundation reports receiving in-kind donated legal services on which it placed a total value of $14,902,284.

[Note: CharityWatch generally excludes the value of in-kind (non-cash) donations of goods and services from its calculations of Program % and Cost to Raise $100. More information on how grades are calculated and the treatment of in-kind donations can be found on the Our Process page.]

According to the ACLU Foundation consolidated audit of March 31, 2020 (Note 2 re: Donor concentration):

"Approximately 20% of the total grants, contributions and bequests revenue of $176,437,112 were provided by three donors for the year ended March 31, 2020..."

According to the ACLU Foundation tax filing for the fiscal year ended March 31, 2020, the Foundation reports for Business Transactions Involving Interested Persons a transaction in the amount of $104,101 involving Gary Sowards, the spouse of an officer/key employee. The transaction is described as follows:

"During fiscal year 2020 Gary D. Sowards, the spouse of officer/key employee, Dorothy Ehrlich, provided legal services in connection with the ACLU Foundation's John Adams Project, which has arranged for the representation of an individual charged with a capital crime. A nationally known expert in capital punishment, Mr. Sowards was retained via a decision making process that did not involve the officer/key employee and at rates that are customary for the services provided" (IRS Form 990, Schedule L, Parts IV & V).

According to the ACLU Foundation consolidated audit of March 31, 2020 (Note 2 re: Evaluation of subsequent events):

"The Foundation evaluates events occurring after the date of the [audited] consolidated financial statements to consider whether or not the impact of such events needs to be reflected and/or disclosed in the consolidated financial statements. Such evaluation is performed through the date the consolidated financial states are issued, which is September 30, 2020.

"On January 30, 2020, the World Health Organization declared the coronavirus outbreak a 'Public Health Emergency of International Concern' and on March 11, 2020, declared it to be a pandemic. Actions taken around the world to help mitigate the spread of the coronavirus include restrictions on travel, quarantines in certain areas and forced closures for certain types of public places and businesses. The coronavirus and actions taken to mitigate the spread of it have had and are expected to continue to have an adverse impact on the economies and financial markets of many countries, including the geographical area in which the Company operates. ... It is unknown how long the adverse conditions associated with the coronavirus will last and what the complete financial effect will be to the Foundation."