Nonprofit board duties: care, loyalty, obedience
Nonprofit directors and trustees typically owe duties of care and loyalty, and many jurisdictions and practitioners describe a duty of obedience to the charitable mission and governing documents. State attorneys general and the IRS Form 990 add transparency and oversight layers.
Prepared doesn't make your decisions. It keeps the record that shows how you made them.
Educational only — not legal advice. Details
Fiduciary duties and process standards vary by entity type, charter, bylaws, and jurisdiction. Consult qualified counsel for your board. Using Prepared Board does not ensure business judgment protection, does not prevent liability, and is not a substitute for legal advice, D&O coverage advice, or a fairness opinion.
Care, loyalty, obedience
Care and loyalty parallel the corporate framing: inform yourself, avoid improper conflicts, put the mission first.
Obedience (as commonly taught in nonprofit governance) means staying faithful to the stated charitable purpose and to limits in the articles, bylaws, and gift restrictions — not improvising a different mission because it is convenient.
State AG oversight — Maine and New Hampshire
Maine’s Attorney General publishes a Guide for Board Members for charities and public-benefit corporations and oversees charitable assets.
New Hampshire’s Charitable Trusts Unit registers and reviews charitable organizations, with annual reporting that often uses Form 990 materials.
Other states differ. Always check your domicile and registration states with counsel.
Form 990 governance questions
IRS Form 990 Part VI asks whether a copy of the Form 990 was provided to the governing body before filing and how the organization reviews the form. Honest answers depend on a real board process — which is why Prepared tracks a board-declared Form 990 / filings review window (Prepared does not file or e-file).
So what for you as a director
- Calendar Form 990 board review; record Not started / Packet ready / Board reviewed.
- Keep related-party and conflict processes tight — AGs and Form 990 both care.
- Document mission-constrained decisions (easements, restricted gifts, program pivots).
- Export a diligence / board-proof pack before an AG or funder ask.
What a good record looks like
Mapped to live Prepared Board routes. Counts and process records only — not a finding that duties were met.
- Filings window (Form 990 board review)
Board-declared review status — Prepared does not file with the IRS.
- Form 990 governance guide
Operator checklist for Part VI-style questions.
- Piscataqua / Seacoast demos
Land trust + chamber seeded boards.
- Governance calendar
Annual obligations in one year view.
Verified citations on this page
- Maine AG — Guide for Board Members — Maine Office of the Attorney General. Maine’s Attorney General publishes guidance for charity / public-benefit corporation board members on oversight responsibilities and the AG’s role in protecting charitable assets. Source
- New Hampshire Charitable Trusts Unit — NH Department of Justice — Charitable Trusts. New Hampshire’s Department of Justice Charitable Trusts Unit oversees charitable organizations, including registration and annual reporting (often using Form 990 materials). Source
- IRS Form 990 Part VI — IRS Form 990 (Part VI) / Schedule O. Form 990 Part VI asks governance questions, including whether a copy of the Form 990 was provided to the governing body before filing and how the organization reviews the form — board process documentation supports honest answers and Schedule O narratives. Source
- Delaware Corporate Law — business judgment — Delaware Division of Corporations — The Delaware Way. Delaware’s official corporate-law materials describe the business judgment rule as protecting informed, good-faith board decisions made in the honest belief they are in the corporation’s best interests — process and information matter. Source
See a live process record
Open a seeded demo board, then Board proof. Or run the public process-record self-check (gaps only — no score).