501(c)3 organization

501(c)3 organization is a type of charitable organization that is allowed to receive tax deductible gifts. The best examples are the large national charities such as the American Red Cross, American Heart Association or the Salvation Army. Every organization must have a determination letter from the IRS authorizing the status as a 501(c)3 charitable organization.

Form 990 – Return of Organization Exempt from Income Tax

Form 990

Section 6033 of the Internal Revenue Code requires tax exempt organizations to file an annual report.  Form 990 fulfills this requirement.  Many citizens utilize the information from Form 990 to evaluate the non-profit organization they donate to annually.  The 990 covers much of the information any citizen desires to know about the charity of their choice.

What is an Audit?

An audit is defined as a methodical examination.  Audits are grouped into two principal sets – financial and organizational compliance (usually related to licensure).  For the small business entrepreneur, it is almost unheard of for them to have an organizational compliance audit.

How to Start a Non-Profit Organization: Step 3 – The First Board Meeting

Step three of starting a non-profit organization is gathering the potential board members for the first meeting.  In step one; you formed a brain trust to validate the mission of the non-profit organization.  In step two; you generated a list of potential board members by identifying sources and creating profiles.  In this step, you have to get everyone together, present the mission to the group, get commitments to help, and set a date to legally form the non-profit organization.

The 501(c)3 Organization

Taxation

I have had many clients come to me to ask how they could start a non-profit organization.  The main purpose of starting a nonprofit is to gain the contribution advantage the Internal Revenue Service (IRS) provides.  Why do you need the IRS to authorize this? What is the difference between tax exempt and a charitable organization?  How does the church fit into all of this?

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