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Nonprofit and Charitable Organizations Including 501(c)(3)
Published: 07/29/2011 by Louise Aron, Attorney - Helping you Grow Your Business
Copyright 2011 Louise Aron All Rights Reserved
NONPROFIT AND CHARITABLE ORGANIZATIONS,
INCLUDING 501(c)(3)
The firm has formed a number of nonprofit or charitable corporations, including 501(c)(3) organizations.
Documents. The Articles of Incorporation, Bylaws, I.R.S. Application for Recognition of Exemption, tax returns and other records and financial data regarding nonprofit organizations are available to the public and therefore should be properly prepared by an attorney.
Documents needed to validly form a nonprofit corporation include Articles of Incorporation, Bylaws and Consents to Action or Minutes. Numerous documents are required to apply for and obtain a federal tax exemption, including detailed financial data about the activities and fundraising in which the organization intends to engage. Conflicts, Whistleblower and Document Retention Policies are also referenced by the IRS on annual tax forms, and should be discussed and adopted.
Procedure. As you probably know, filing the appropriate documents with the Internal Revenue Service (IRS) must occur in order for contributors to claim a tax deduction for contributions. It is best that the corporation's documents be drawn up by a qualified attorney, and the financial records kept under the auspices of a C.P.A. This should occur prior to conducting charitable activities and raising funds because activities and fundraising that occur prior to filing for an exemption with the IRS must be described in detail, and this makes the documentation more complex.
Once the entity is properly documented, efforts to conduct activities in another state, obtain financing, and enter into contracts are facilitated when the organization’s records must be produced because the documents are and always have been in order.
No Owners. No one owns a charitable organization (nonprofit corporation). Such an entity is not intended to be the property of the incorporator, its founder, executive director or of any other person. The board of directors of the nonprofit determines its direction and activities.
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Copyright 2011 Louise Aron All Rights Reserved