tax exempt non-profit-organization attorney lawyer

7/28/2019 Tax Exempt Non-Profit-Organization Attorney Lawyer

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TAX-EXEMPT & NON-PROFITORGANIZATIONS


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Benefits of Non-Profits

Limited liability protection of trustees andmembers

Exemption from federal income tax

Eligibility to receive tax-deductible contributions

Donors federal income taxdeduction

Lower postal rates on certain bulk mailings


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Disadvantages of Non-Profits

Limitations on the sources of income

Inability to divide profits among members beyond reasonablesalaries

Paperwork, paperwork, paperwork

Restrictions on the use of assets topurposes

Justifying tax exemption; public scrutiny; availability of financial documents topublic


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Apply for recognition of exemption via form 1023.

include

The Process- Federal


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EIN

Organizing Documents

Bylaws

Description of activity

Conformed copy

Financial statements showingreceipts and expenditure

Balance sheet for this yearand three previous years


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The IRS may ask for more information,so have prepared


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Copies of advertisingplaced

Copies of publications

distributed written

material used for

expressing views onlegislation

Copies ofleases/contracts/agreements


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Registration Time


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The IRS will issue letter or recognition or request for

additional information within 90 days for the following threecategories:

Those that are submitted on obsolete forms/do not include itemsspecified in procedural checklist.

Those that can be approved immediately based on informationsubmitted

Those that need minor additional information.


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All other applications referred to Determination Specialist

to approve, withdraw, or deny application.

Currently, the federal government is processing applications within 2 months to 12 months.


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Submit form 532 and a signed copy of articles ofincorporation to Secretary of State,

include:

The Process- State


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Corporate name

Place of principaloffice in Ohio

Purpose for formingcorporation

Names and

addresses of at leastthree (3)initialdirectors

Do not include anything with SSN or federal TIN


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Secretary of State hasdiscretion to accept or deny

application!


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If corporation plans to sell items to general public, it willneed to register for the appropriate vendors license

Regular: $25.00; Transient: $25.00;

Delivery: $25.00; Service: $25.00

The Process- Local


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Although a non-profit may make atremendous amount of income, it must remain

compliant. Non-profits must:

Restrictions on Non-Profits


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Absolutely refrain from participation in politicalcampaigns

Restrict lobbying activity

Ensure that its earning do not inure to private shareholders and

individualsNot operate for the benefit of private interests

Not operate for the primary purpose of conducting a trade or businessthat is not related to tax exempt purposes

May not have purposes of activities that are illegal


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To further remain compliant, a non-profit must:

File a990-EZ, 990PF, or submit an electronic 900 annually

Failure to file for three (3) consecutive years revokes exempt status

Must report significant changes to program services or organizational documents

The following forms may be filed electronically through the approved IRS 990 efilerprovider:

Maintenance- Federal

Form 990; Return of Organization Exempt from Income Tax; Form

990-EZ; Short Return of Organization Except from Income Tax,Form 990-PF; Return of Private Foundation; Form 990-N (e-

Postcard); Form 8868; Application for Extension of Time To File anExempt Organization Return; Form 1120-POL; U.S. Income Tax

Return of Political Organizations Form 7004; Application forAutomatic Extension of Time To File Certain Business Income Tax;

Information, and Other Returns (extension form for Form 1120-POL).


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To further remain compliant, a non-profit must:

Maintenance- State

Must file a Statement of Continued Existence every five yearsand keep all information regarding the statutory agent current.

Articles may be amended by voting members at a meeting

and a certificate containing a copy of the amended resolution,and a statement of the basis of the adoption must be

prepared, signed by an authorized officer, and filed with theSecretary of State.


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If $10,000 or less in gross receipts, then $2,000.00

If $10,000 or more in gross receipts, then $2,500.00.

Pre-Existing Organization, then $3,250.00.

The Costs


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Signed Fee Agreement and Consult Fee.

Signed Power of Attorney Form.

Mission Statement 3-5 sentences.

Contact information for your current accountant.

The Next Steps


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http://grantspace.org/Tools/Know

http://www.irs.gov/charities/

http://www.form-a-corp.com/non-

http://smallbusiness.findlaw.com/business-structures/non-profit/non-profit-tax-exempt-pro-con.html

Bibliography
http://grantspace.org/Tools/Knowledge-Base/Nonprofit-Management/Establishment/Pros-and-conshttp://www.irs.gov/charities/http://www.form-a-corp.com/non-profits_QA.phphttp://www.form-a-corp.com/non-profits_QA.phphttp://www.irs.gov/charities/http://grantspace.org/Tools/Knowledge-Base/Nonprofit-Management/Establishment/Pros-and-cons