pawLAW
Have You Been Considering Starting A Nonprofit?
–by Dionne M. Blaesing, Esq.
IN THE LAST FEW YEARS, ANI- MAL LOVERS have come to understand that a euthanasia pro- gram is not a solution for pet overpopulation nor is it palatable as humane treatment for the stray dogs and cats troubling our neighborhoods. People are creating rescue groups
and organizations to harbor strays safe- ly with the goal to place these animals in caring, permanent homes. The most successful of such groups understand that their mission is a business and must be organized like a business complying with local, state and Internal Revenue ordinances and reg- ulations. Failing to do so can result in personal tax and legal liability for the folks who are trying to do a good thing. If you are one of the good people,
I suggest that you work with an expe- rienced animal and business law attor- ney and an experienced charity organ- ization CPA before you begin opera- tions. As a Florida licensed attorney, my comments are based on Florida law. You should seek legal assistance from an attorney licensed in the state where you will establish the rescue. Further, my comments are a just a guideline; This article simply cannot address all the complexities and deci- sions each organization will face. STEP ONE: Set Up A
Florida Not For Profit Business Organization. In Florida, State statutes provide for options that include a sole proprietorship (the
www.TheNewBarker.com
default format if you have not created a business entity with the Department of State Division of Corporations), corporation, LLC, partnership or the not for profit corporation. You are not creating a rescue or humane organiza- tion to make a profit; the commonly used entity available to you is the Fl. St. 617. Not for Profit Corporation. Note there are more complex organi- zational options for special situations which are too complex to address here.
To set up the entity, you must
comply with the provisions of Fl. St. 617; meaning basically, you must file the appropriate Articles of Incorporation, signed by the incorpo- rator(s), name a directorship or board of directors, perhaps name officers, name a registered agent (who must sign to accept the designation), and pay the fee for incorporation to the State of Florida. Although a person can do this electronically at
www.sunbiz.com, (Florida Department of Corporations), I suggest that an attorney be involved to help you avoid pitfalls which may haunt you later. STEP TWO: Obtain An EIN
Number For The Corporation (IRS form SS5). An EIN is the Employer Identification Number for
your organization, used for all banking, tax and registration requirements under federal or state law. It is comparable to a social security number. You will need the number even if you have no employees.
You must file a completed IRS form SS5 with the IRS. You may do this electronically at the IRS website,
www.IRS.com; the IRS will respond almost immediately with the corporate EIN number. STEP THREE: Obtain the
IRS Federal Tax Exemption 501C3: (Either IRS form 1023 or 1023ez depending on size and financ- ing). Now you must register with the federal government to avoid federal tax liability. If you skip this step, the IRS will not recognize your not for profit status even though you have a Florida not for profit corporation reg- istered with the State of Florida. The IRS does not grant tax exempt status to a sole proprietor. If the corporation is not granted IRS exemption, it can- not be exempted for Florida taxes. The IRS Code 501C(3) is
designed for animal humane charities. The corporation must file application form 1023 or 1023ez with the IRS. Once granted, the IRS will not tax the money coming into the organiza- tion as a corporate profit nor as tax- able personal income of the rescue organizers. Have your CPA establish a corporation book keeping system to ensure it is kept up to date.
Continuedg Summer/Fall ~ 2015 THE NEW BARKER 67
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52 |
Page 53 |
Page 54 |
Page 55 |
Page 56 |
Page 57 |
Page 58 |
Page 59 |
Page 60 |
Page 61 |
Page 62 |
Page 63 |
Page 64 |
Page 65 |
Page 66 |
Page 67 |
Page 68 |
Page 69 |
Page 70 |
Page 71 |
Page 72 |
Page 73 |
Page 74 |
Page 75 |
Page 76 |
Page 77 |
Page 78 |
Page 79 |
Page 80 |
Page 81 |
Page 82 |
Page 83 |
Page 84 |
Page 85 |
Page 86 |
Page 87 |
Page 88 |
Page 89 |
Page 90 |
Page 91 |
Page 92 |
Page 93 |
Page 94 |
Page 95 |
Page 96