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NONPROFIT BUSINESS REPRESENTATION

Operating a nonprofit business usually means you are involved in a charitable activity as defined by the IRS under section 501(c)(3) of the revenue code.  However, there are actually twenty-nine different sections under 501(c) of the revenue code defining twenty-nine different types of nonprofit organizations.  The most common are charitable, religious, educational, and scientific under 501(c)(3), and social and recreational Clubs (such as fraternities, sororities, and clubs like the Masons, Kiwanis, and the Elks.

Forming and operating a nonprofit corporation is much like creating a regular corporation.  You file your corporate document with the Secretary of State, but then must take the extra stem of applying for tax-exempt status with the IRS. Since the IRS is not in business to allow people to avoid paying taxes, the application and review process is highly scrutinized. Phillips Law Firm, Inc., we have been 100% successful in getting our nonprofit clients approved by the IRS.

Here is what we do to assist our clients when forming a nonprofit corporation:

  • Choose a name that meets the requirements of state and federal law.
  • File the articles of incorporation with the Ohio Secretary of State.
  • Obtain an Employer Identification Number (like a Social Security Number, except for businesses) from the Internal Revenue Service.
  • Create operating rules for your nonprofit corporation.
  • Assist with the appointment of the Board of Trustees
  • Obtain licenses and permits that may be required for the nonprofit corporation.
  • Apply for your federal and state tax exemptions.

The cost of the last step is usually a surprise to many individuals, because it tends to be the most time consuming.  Charities being organized for charitable, religious, scientific, or educational purposes file Form 1023.  Other nonprofit organizations, such as college fraternities for example, file Form 1024.  The forms are similar, and if successful result in federal recognition as a nonprofit corporation.  Completing Form 1023 or 1024 requires that the applicant do the following:

  • Describe the organization’s specific activities
  • Include a copy of the complete organizing documents (e.g., Articles of Incorporation, Bylaws, Regulations, etc.)
  • Include financial statements with the application for 3 years of economic budget projections, including a detailed breakdown of revenue and expenses.

After the corporation is formed, we help you to comply with all of the specialized laws applicable to nonprofit corporations. Phillips Law Firm, Inc. assists in the creation and operation of nonprofit corporations and provides guidance to many nonprofit corporations.  Our attorneys sit on the board of a charitable corporation, and on a different board for a fraternal organization. If you need help operating your nonprofit corporation, or when you are ready to start your own nonprofit corporation, whether it be charitable or not, do it right, with the help of an attorney from Phillips Law Firm, Inc.  If you want to talk to somebody who understands the laws that are facing you, we can help you.

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