Are you ready to start a new nonprofit organization?
Starting a new nonprofit organization can be fulfilling experience as you work to address pressing issues affecting your community. We know that there are many questions when forming a new charity. To help, here are some common questions to help you start a new nonprofit organization.
What is a nonprofit?
The word “nonprofit” generally describes an organization that works to serve a public purpose, rather than to provide financial benefit to any particular individual, corporation, or entity.
Nonprofits are organized around a cause, mission, or community need. They are organizations that work to serve a public purpose.
Who will your organization serve?
When starting a new organization, it is important to be able to clearly define who your organization will serve. What is your cause or community need? Is there a specific class or group (people, animals, school, etc.) that you’ll provide support or services to? Since nonprofit organizations serve some public purpose, it’s important to define this group to be served.
What programs will your nonprofit offer?
What will you do to help your community? How will you provide services? Who will perform the work? How will clients learn of your service? Where will the work occur? When will you perform this work? It’s important to clearly define the work your organization will do.
Who owns the nonprofit? Who manages it and runs it?
One of the most often confused aspects of nonprofits concerns “ownership” of a nonprofit.
No person or group of persons can own a nonprofit. Nonprofits cannot be sold. And any surplus earned by a nonprofit is invested in the nonprofit’s activities.
Since there are no “owners” of a nonprofit, they often are managed by a board of directors or by members.
How will the nonprofit be financially supported?
It’s important to consider your organization’s budget and how it will raise funds. Consider what will it cost to start the nonprofit, hire staff, develop programs, purchase supplies, lease space, and buy insurance. Additionally, it’s also helpful to understand laws and regulations related to fundraising.
What is an IRS 501(c)(3) entity?
501(c)(3) refers to a specific tax category in the Internal Revenue Code. There are dozens of 501(c) categories — the (3) is just one of many. Many nonprofit organizations apply for and receive 501(c)(3) status from the IRS.
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- Nonprofit status refers to incorporation status under state law.
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- Tax-exempt status refers to state and federal income tax exemption. The 501(c)(3) designation is one such federal tax-exemption. But, it is important to note that there are dozens of 501(c) categories. An organization must meet certain requirements and apply for tax-exemption. It must apply to the IRS to get that tax-exempt designation. Usually, the organization will use IRS Form 1023 or Form 124.
How We Help You Start a New Nonprofit Organization
Launching a nonprofit can be an exciting (but sometimes overwhelming!) experience.
We help clients form new nonprofits and tax-exempt organizations – charities, foundations, associations, and social enterprises.
We give your start-up a solid legal structure so that you can find success.
You have a passion for creating positive change. We have the legal know-how to make it happen. No matter the type of organization you want to set up, we handle all the paperwork and the legal “red tape.” We will be your advocates before the IRS, pushing for a quick determination and answering any questions raised on your behalf.
We would love to help. Give us a call!
Learn More
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