Monthly Archives: August 2012

Stage 4 of Non-Profit Incorporation: State Filing

State Filing Non-Profit Incorporation from The Startup Garage

Stage 4 of Non-Profit Incorporation: State Filing

Once all your federal forms have been filed, you can move on towards your state-specific forms. Each state varies in what type of forms they need submitted for non-profit organizations but a few of the typical forms include:

Application for state tax exemption

  • California requires a separate application for exemption from state taxes: Form 3500
  • For other states, search for state tax exemption in your state or look at your state’s Department of Revenue web site.  All state’s DoRs are listed here.

Application for a tax identification number

Register for permission to solicit funds for your organization and with the Registry of Charitable Trusts

  • The Registry manages and oversees the financial reports of charitable trustees and fundraising organizations. You can register at the Office of the Attorney General.
  • In California, forms are available on the Attorney General’s web site.

Filing your Statement of Information

  • This is your public disclosure of principle business activity and location, as well as the name of the CEO and other managers  The Statement of Information must be re-filed periodically.
  • In California, Form LLC-12.

To check what state specific files affect you and your organization, click here to learn more.

 

Whether you have a question about State Filing, or you’d like to discuss our business plan writing services, feel free to contact us for a free consultation!

Stage 3 of Non-Profit Incorporation: Federal Filing

Federal Filing Non-Profit Incorporation From The Startup Garage

Stage 3 of Non-Profit Incorporation: Federal Filing

  • An Employer Identification Number (EIN) is a nine-digit number assigned by the IRS used to identify operating businesses – it may also be referred to as a Federal Tax Identification Number. Your  EIN will allow you to apply for federal tax exemption status as a 501(c)(3) charitable organization. EINs do not expire.
  • You can obtain an EIN for free through the IRS by mail, fax, toll-free phone, or online submission. Click here to read more on how to apply, or download Form SS-4 right now.

Apply for Tax Exemption

  • 501(c)(3)
    • After qualifying your organization as a non-profit corporation, you may wish to further apply for a 501(c)(3) tax exemption.   There are many benefits to qualifying as a 501(c)(3) tax-exempt charitable organization, including exemption from federal and, in some states, state taxes, as well as qualifying your organization for special grants and government funding. Donors favor these organizations, as their contributions will be deducted from their own taxes.
    • If you are applying for 501(c)(3) status, the main form you will need to process is Form 1023, the Application for Recognition of Exemption.  Although roughly 80% of all Form 1023s are filled out by individuals, it is recommended that you have an attorney or tax law expert look over your work to avoid delays due to mistakes.  For in-depth help with filling out Form 1023, we recommend looking at Form 1023 Help, which was also recommended by the Non-Profit Resource Center. They provide step-by-step instructions and explanations for each of the form’s 11 sections.
    • You can elect to be permitted to make limited expenditures to influence legislation as a 501(c)(3) if you file Form 5768.  Please see our following blog post on the legal problems with lobbying to ensure your organization is protected from receiving fines.
  • Tax exemption is not limited to 501(c)(3) organizations.  For information about qualifying for and receiving tax-exempt status for your business read the IRS’s Publication 557 to see if you qualify.
  • If you qualify for tax-exempt status under §§ 501(c)(2), (c)(4)-(13), (c)(15), (c)(17), (c)(19) or (c)(25) and have to fill out  Form 1024, and you must also fill out Form 8718, which is your application fee file.  Both files must be sent together.
  • If you want your organization to be represented by an agency or agent, you must file a Power of Attorney form along with your tax exemption files. This can be found with Form 2848.

*The information contained in this post is provided for informational purposes only, and should not be construed as legal advice on any subject matter.  You should not act or refrain from acting on the basis of any content included in this site without seeking legal or other professional advice. The contents of this post contain general information and may not reflect current legal developments or address your situation. We disclaim all liability for actions you take or fail to take based on any content on this site.
 

Whether you have a question about Federal Filing, or you’d like to discuss our business plan writing services, feel free to contact us for a free consultation!

Video Friday: Amount of Time Spent on Business Plans

Video on Time it Takes to Write a Business Plan From The Startup Garage

Video Friday: Amount of Time Spent on Business Plans

This week, Tyler Jensen will explain how much time The Startup Garage spends on writing business plans.

 

If the link isn’t working, check out the video at http://www.youtube.com/watch?v=9kv0cBRkkSY.

View our archived videos on our YouTube channel at http://www.youtube.com/user/thestartupgarage?feature=watch.
 

Whether you have a question about Business Plans, or you’d like to discuss our business plan writing services, feel free to contact us for a free consultation!

Stage 2 of Non-Profit Incorporation: Planning

Non-Profit Incorporation Planning From The Startup Garage

Stage 2 of Non-Profit Incorporation: Planning

Create a Business Plan

  • Beyond the Mission Statement and Purpose that you have already drafted, you should create an entire business plan that will serve as a roadmap as you get your operations started.  The Business Plan includes your mission and purpose, but also provides detail on all aspects of your business: the budget and financials, the target audience, your marketing plan and your management structure.  All this information is necessary to serve as both an internal framework as well as a communication aimed at external parties such as investors.  The Startup Garage specializes in writing business plans and we provide a wealth of information on the topic elsewhere on our site- feel free to explore!

Write and File Articles of Incorporation

  • Once you have a board assembled and a name registered with the state, you must write your non-profit’s Articles of Incorporation, which are the documents that your state needs to recognize your organization as a corporation.  In California, the web link for the PDF to fill out and submit is here.  You can search for another state’s Secretary of State page here.  You can search for additional information on your state’s incorporation laws on NOLO’s page here.  Read the instructions carefully to ensure you are aware of any other documentation that is required, such as the Statement of Information for non-profits in California.  The mandatory contents of the Articles of Incorporation are governed by the state’s Corporations Code but generally include the names and signatures of the directors, the stated mission and purpose, proof of ownership of the corporation’s name, a disclosure acknowledging that there will be no private gain, and a filing fee.

Draft Governance Policy

  • Corporate governance is a hot topic following the financial crisis, and you must ensure that your non-profit is up-to-date on the important features of a comprehensive governance policy.  The policy will include the bylaws that govern the non-profit, a conflict of interest policy, and a compensation policy.  Look into how Sarbanes-Oxley affects your non-profit at the National Council of Nonprofits page here.  The governance policy is most importantly applied to the Board as it relates to their fiduciary duty to the non-profit.

*The information contained in this post is provided for informational purposes only, and should not be construed as legal advice on any subject matter.  You should not act or refrain from acting on the basis of any content included in this site without seeking legal or other professional advice. The contents of this post contain general information and may not reflect current legal developments or address your situation. We disclaim all liability for actions you take or fail to take based on any content on this site.
 

Whether you have a question about Incorporation Planning, or you’d like to discuss our business plan writing services, feel free to contact us for a free consultation!