There is always a meaningful motive behind to start something new, A motive can either be financial or social benefits.

A nonprofit is an entity which gives both benefits such as saving and securing.

1. A nonprofit entity saves humanity from a harmful life and
2. A nonprofit organization helps donors to secure taxes.

A nonprofit is a legal entity which is created by the state and federal, that helps humanity rather than staying contained to self-interest. In a nonprofit organization, revenues are called contributions, whereas disbursements are called distributions.

We will cover in this program the point of intersections between nonprofit organizations and departments such as;

• Secretary of state,
• Internal Revenue Services and
• With the attorney general office.

We will also try to review every essential aspect of a nonprofit which someone may need to know in-order to initiate a nonprofit institution.

1. How to create a nonprofit organization under state laws?
2. How to acquire an employer identification number for a nonprofit institution?
3. How to file for Federal tax classification with the Internal Revenue Services?
4. Why do we file a nonprofit organization with the attorney general's office?
5. Why do we file a nonprofit organization with the department of revenue and the division of taxation and finance?

It is important to comply with laws to maintain any legal entity regardless of a profit or a not-for-profit entity. Intentionally and unintentionally ignoring laws may wipe out your years of struggle in a moment. We Will cover in this program, different aspects of a nonprofit organization from registration through resignation.

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Giving back to societies in different forms such as in the form of cash contribution or service, contribution is an old fashion and tradition to help people and improve society's lifestyle.

Generally, a person gets motivated by financial benefits and that's why a nonprofit organization was given a legal status by the lawmakers to claim expenses to reduce tax liabilities for securing financial benefits and holds a person accountable for collecting contribution and its legit distribution to stop mishandling funds of a nonprofit organization.

Based on my research, the first nonprofit entity was started in the United States was in 1940 which was created by Edward L. Ryerson. She was a steel executive and she lived in Illinois. The name of the organization was Council on Foundation and it was funded by community individuals.

To do something different gives you energy, keeps you motivated and restores your faith in what you are doing is a great, unique and demanding cause for society that keeps you free from the fear that you may be held accountable.

A nonprofit organization is created to serve society for many purposes and the intention behind a non-profit-organization must not be generating income, rather than the intention must be distribution of funds fairly that has been contributed by the donors to be spent for a good cause.

Yes, it is the duty of the state to help every citizen, but in practice it is not possible for a state so the communities people take some burden of the state and in return, the state gives them financial benefits such as the state allows them to claim contribution on their income tax returns to reduce tax liability.

A nonprofit is called by many different names such as;

1. Not-for-profit organization,
2. Nonprofit organization
3. Non-business entity or
4. A nonprofit institution.

Even though, the names and indicators may be different, but the purpose still remains same, to register a nonprofit entity.

1. Religious organization where people of the same faith worship at religious sites, such as Churches, synagogue mosques and temples.
2. Research and development or a scientific organization are also one kind of nonprofit organizations which were established to discover or enhance technology to improve lifestyle.
3. A nonprofit is created to help communities, to provide basic human needs such as food, cloth and a place to live temporarily or permanently.

A Nonprofit organization is not allowed for any political activities and contribution in political activities is not tax deductible as well.

Generally a nonprofit is managed by:

1. Officers
2. Directors
3. Employees
4. Trustees
5. President
6. Vice President
7. Secretary, And
8. Managers

A nonprofit organization generates donations through campaigns and acquire government grants rather than revenues. It receives donations from generous people and organizations to operate.

A Donor and Do-nee play a vital role in rolling a nonprofit. A donor is a person or an organization who makes a contribution voluntarily in a form of cash or service whereas a Do-nee is a person or an organization who receives gift to start and run a nonprofit organization.

Registration of a nonprofit organization is a triangular process. Every nonprofit organization is registered with;

1. The State or county which depends on the activities of a nonprofit organization.
2. The Internal Revenue Services for federal tax exemption, And
3. The Attorney General Office for state tax exemption.

Articles of certificate of incorporation are filed by the state or county which depends on each state and the type of entity; For Example : A nonprofit for a hospital will be filed with the state, whereas a religious organization article is filed by the county clerks office in the state of New York.

• After the approval from the state examiner, an Employer Identification Number is applied to the Internal Revenue Services.
• The EIN does not mean that you have gotten a federal tax exemption approval rather it is simply issued to start nonprofit and open bank account.

After the initial incorporation filings with the secretary of state, we file 501C-3 with Internal Revenue Services along with :

1. Bylaws, which normally includes purpose of a nonprofit, titles of the officers and their duties and dissolution clause.
2. Narrative description is filed which includes detailed purpose and how a nonprofit will serve communities.
3. Conflict of interest statement or a duality of interest statement is filed, which include policies and procedures of a nonprofit entity, that any officer or trustee will not conflict with the position, financial responsibility or other duties performed by nonprofit and in the community.

After getting the approval of Federal Tax Exemption from the Internal Revenue Services which is also called 501c3, the approved articles are submitted to the attorney general office to acquire a state tax exemption which is important to claim donations and receive contributions in tax returns.

Without having tax exemptions from the state and federal, a nonprofit organization cannot collect donation and a donor cannot claim contribution to get the tax benefit.

There are a number of reasons that may wipe out a nonprofit organization temporary or permanently:

1. Failed to file tax returns to the state and federal for three consecutive years.
2. Failed to renew on or before the due date. And
3. Involved in any prohibited activity.

A nonprofit organization is required to register in each state under principle nonprofit organization to extend operation of the same organization in a different state. And, let me explain the process:

1. A foreign entity is established under a principle nonprofit organization to extend operation in the state where the operation will be started with the principle nonprofit organization. It is also known as a certificate of authority and transact business in another states.
2. Principle's nonprofit institution, employer identification number will be used rather than obtaining a new E.I.N from the Internal Revenue Services.
3. Principle nonprofit institution, federal tax exemption will be used rather than applying for a new federal tax exemption.
4. The additional state exemption form will be submitted to a new state attorney general office to get the state tax exemption.
5. Sales tax permit will be obtained from the department of revenue where a foreign entity of principle nonprofit is organized.

There is no blanket nonprofit registration is existed in the United States which gives the authority to a nonprofit entity to operate universally under one registration.

It depends on each state most states do allow it, whereas a few do not allow the move from one state to another. You may get information from the secretary of state if both the states allow the domestication of a nonprofit organization.

Every active nonprofit entity, whether it has any activity or not, it is required to file the end of the year tax returns. A nonprofit, tax filing date is generally different from a regular business entity which depends on the type of entity and state requirements.

In either case a Non-US-Resident can participate in nonprofit organizations. There is no restriction in the United States for a Non-US-Resident which stops a Non-US-Resident from registration of a nonprofit.

Trademarking is vital for branding a business in any particular industry and it is one of the most valuable intangible assets of any organization regardless of a business or non-business entity.

A nonprofit is capable of filing a trademark and registration of a trademark is a three-step process.

1. Searching of a trademark availability
2. Publishing legal notices in newspapers
3. Issuance of the trademark certificate by the United States Patent and Trademark Office

A trademark is renewable every after ten years.

Before filing an application to file for trademarking, name availability is checked in different search engines such as Google and Yahoo and it is also checked on the United States Patent and Trademark Office website.

Searching a name for trademark is a complex and time-consuming process, and it is highly recommended to use a professional's help.

A nonprofit pays salary to employees and managers, provided they are working for a nonprofit organization. Withholding registration is filed in a state where a nonprofit is registered in order to apply for payroll registration.

A legally registered entity in the United States can be sued and non-profit is also a legally registered entity and it is capable to be sued. So, it should abide applicable laws to remain in good standing.

Sales tax registration is recommended for a nonprofit organization to avoid paying sales tax on purchasing taxable items. Department of revenue or the division of taxation and finance issue sales tax permits to not-for-profit entities.

Every profit and nonprofit organization are required to acquire an employer identification number which is used to:

1. Open bank account
2. Filing taxes
3. To hire employees
4. To get a withholding number
5. Getting sales tax permit, And
6. To get business licenses

A withholding number is used to hire employees and it is issued by the department of revenue or the division of taxation and finance.

The entire process may take between sixty days to ninety days or more which depends on the nature of a nonprofit organization to register.

Every nonprofit application must be approved by:

1.     Secretary of state or county clerk's office which depends on the type of nonprofits organization.
2.     Federal tax exemption from the Internal Revenue Services
3.     Filing with the attorney general office
4.     and other registrations which includes sales tax and withholding numbers.

Articles of dissolution are filed with the consent of the responsible parties of nonprofit organizations to terminate a nonprofit organization.

Registration with states and federal for a nonprofit organization gives the ability to donors and receivers to apply expenses and contributions in their tax returns which is not possible without registration.

The Internal Revenue Services maintains an online database to verify if the organization has a valid tax exemption status.

A nonprofit organization issues letters to all donors at end of the year for the amount they have given to the organization in donations to claim on their tax returns.

Nonprofits are very sensitive entities and audit chances of nonprofit organizations are very high, so it is highly recommended to keep all donors and vendor records to defend an audit.

The internal Revenue Services may ask you to conduct audits at location or simply send the requested documents to the Internal Revenue Services to review.

You can file a resignation to the board and request to remove your name from the articles of a nonprofit organization.

A volunteer who makes a contribution to a nonprofit organization in the form of service is not tax deductible. Only cash and a tangible asset are tax deductible such as a car.

A few states of the United States have a provision to register a nonprofit organization as a limited liability company, but the Internal Revenue Services may or may not allow a federal tax exemption.

Even though a nonprofit is created to collect donations, the Internal Revenue Services allows nonprofit organizations to receive unrelated income which will be reported and taxed as regular income.