Setting Up A Non-Profit Corporation
How is a "non-profit" corporation similar to other corporations?
A non-profit corporation is just a corporation. But it's more than just a corporation at the same time. So, you have to have by-laws and you have to set up articles of incorporation, but they're a little bit different depending on what your states laws are. So, if the articles of incorporation for a regular profit corporation has a certain form, on most states, there is a separate form for doing a non-profit. Also it asks a few extra questions. And like we've talked about before when dealing with non-profit corporations, sometimes they might make you name the directors, they might make you state what the purpose is, but again, that is just the formality of setting up the company. That has nothing to do with the separate formality and it's not really a formality but the separate need for filing with the IRS the exemption from taxation.
Do I need a license to raise funds for my non-profit corporation?
Licensing laws vary. They vary statewide; they can vary countywide, citywide. You know, you should be really careful whenever you go out and start soliciting funds for a non-profit. First off, you should definitely make sure you have non-profit status and a tax-exempt status from the IRS if you're telling people that they can deduct as a charitable donation any donations to your charitable company. That being said, you also might need to get a permit to solicit which is something that you would definitely check your local laws for. And I think that the best way of doing that is to, and if I were starting up a brand new non-profit, I would find a non-profit that was similar to mine and I would talk to them. And I would just go up, be friends, and say, "Hey, what is it that you do?" or "What is it that you've done?" And I would talk with the individuals at the county level or the city level and just tell them, "Hey this is what I'm going to be doing, and I want to make sure I'm not violating any laws." And you'd be surprised that kind of an ounce of permission goes to like the pound of forgiveness.
