As a few folks on the list have pointed out, the IRS does have rules governing conflicts of interest. It should be of little surprise that the rules can be a bit complex, confusing, and even counterintuitive -- yes, a financial arrangement with a fourth cousin of a board member, given the circumstances, could possibly be a no-no (not a legal term of art). AAM has guidance to help museums understand and navigate these rules that is available through its bookstore at www.aam-us.org. Here's the listing from the AAM bookstore catalogue: CONFLICTS OF INTEREST: NEW IRS RULES FOR BOARDS, DIRECTORS AND EXECUTIVE OFFICERS Gardner, Carlton & Douglas/Independent Sector/Internal Revenue Service/KPMG, U.S. New rules establish penalties--and procedures to avoid them--for improper salaries, compensation and other financial transactions between nonprofit organizations and the managers who control them. Conflicts of Interest groups three reports that offer an explanation of the new rules and how they affect museums. Know the details of your responsibilities and liabilities. Required reading for trustees, board members, directors, financial officers and other executives of every type of museum. -- PAPER 62PP. 1998 · NO ISBN · $ 15.00 ******************* Barry Szczesny AAM Government Affairs --not an official communication Barry G. Szczesny, Esq. Government Affairs Counsel and Assistant Director Government and Public Affairs American Association of Museums 1575 Eye Street, NW Suite 400 Washington, DC 20005 202/289-9125 Phone 202/289-6578 Fax [log in to unmask] E-mail http://www.aam-us.org Website ========================================================Important Subscriber Information: The Museum-L FAQ file is located at http://www.finalchapter.com/museum-l-faq/ . You may obtain detailed information about the listserv commands by sending a one line e-mail message to [log in to unmask] . The body of the message should read "help" (without the quotes). If you decide to leave Museum-L, please send a one line e-mail message to [log in to unmask] . The body of the message should read "Signoff Museum-L" (without the quotes).