|Create a Nonprofit Organization|
Are you thinking about starting a non profit charity, but are not sure where to start or how to go about it? Have you heard of the term "501(c)(3)" but are not exactly sure what that term means or what significance is attached to it? You are probably not alone. This article helps shed light on some of the issues involved in creating and setting up a non profit charitable organization in Florida. We also describe the basic steps one must take to get your charity off the ground. If you are looking to set up a non profit in Florida, the basic steps to be taken are as follows:
Once you have your proposed charitable mission in mind, you must incorporate. To incorporate a non profit, you must prepare and file articles of incorporation with the Florida Division of Corporations. The articles of incorporation is the document which "creates" your non profit in accordance with state law. The articles contains, among other provisions, name of legal entity, address of the corporation, and name and address of the registered agent.
Additionally, the articles must contain certain special provisions required by the IRS to form a charitable non profit entity. These provisions include a purpose and dissolution clause, respectively. Without such clause, your articles will not be in compliance with IRS requirements. For this reason, it is preferable for you to have a professional, like a CPA or attorney, handle your filing requirement.
Once prepared, the completed articles of incorporation must be submitted to the Florida Division of Corporations along with the state filing fee of $70.00. The filing fee must be made payable to the "Florida Department of State." You must send the articles to the Division of Corporations, P.O. Box 6327, Tallahassee, Florida 32314.
After incorporation, you should obtain an Employment Identification Number ("EIN") for your non profit. You can obtain an EIN for your non profit entity in a few ways. The quickest way is to apply online on the IRS website. However, you might not feel comfortable with that. Alternatively, you can complete IRS Form SS-4 and fax the completed form to the IRS. Typically, you will receive your EIN within 4 business days thereafter. You can obtain more information by contacting the IRS at 1-800-829-4933.
To establish an IRS-recognized charity, the next major step is to apply for 501(c)(3) tax exemption status with the IRS. This step involves filling out a relatively detailed application known as Form 1023, Application for Recognition of Exemption. The purpose of completing this form is so that the IRS will recognize your organization as a tax exempt charity. Moreover, once you have obtained such exemption status, donors who contribute to your charity will be able to make donations that are tax deductible, to the extent permitted by law. In order to obtain such tax exemption status, you must complete Form 1023 and submit the completed application to the IRS along with the applicable IRS application fee. To obtain a copy of the application, you can contact the IRS at 1-877-829-5500.
After the form is submitted to the IRS, within about 3 to 5 months thereafter, the IRS will respond by sending to you a Determination Letter which formally recognizes your entity as a 501(c)(3). If your application is incomplete or a problem arises, the IRS will notify you of this, which may result in delay of the successful processing of your application.
Once you have received the Determination Letter from the IRS, you should notify the Florida Department of Revenue of your charity's tax exemption status by sending a copy of your IRS Determination Letter to that Department. The Florida Department of Revenue can be reached at 1-800-352-3671.
Another issue to consider is the solicitation of donations. If you plan to solicit donations from the general public to support your charity's mission, then you must register your charity with the State of Florida. The registration process is administered through the Florida Department of Agriculture and Consumer Services. In order to register to solicit donations in Florida, you must secure a copy of the registration application from the Florida Department of Agriculture and Consumer Services, fill it out, and then submit the completed application to that department along with the applicable registration fee. You can obtain the registration application by contacting the Department of Agriculture and Consumer Services at 1-800-435-7352.
As a non profit charitable organization, you will also be required to file an annual return with the IRS. This annual filing requirement is important because, if you fail to file the pertinent return for 3 consecutive years, your entity could automatically lose its tax exempt status. Such an event could be devastating to your organization. For this reason, you should hire a CPA at the outset so that he or she can ensure the continued compliance of your organization with federal tax code requirements.