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Re: 503C Nonprofit
Jim Mahoney (jamesmahoney@JUNO.COM)
Wed, 15 Dec 1999 16:43:03 -0500
On Wed, 15 Dec 1999 07:31:55 -0800 Michael Derleth
<michael_derleth@ELI.NET> writes:
>Group:
>Have a fundraising situation we'd like to participate in (a local
>grocery store contributes money for purchases made by troop members),
>but apparently they require non-profit status to "qualify" the group
>first.
>
>Thus, our troop committee is considering filing our own paperwork. I
>know we are "owned" by the church and should be able to use their
>number, but that may not be an option.
>
>Are there IRS/Tax/additional paperwork filings that we would be
>subject to if we were to pursue this?
>
>--
In addition to the paperwork hassles mentioned by some of the other
posters, there are significant costs associated with being a 501(c)(3)
organization. I have been a chief financial officer in various non
profit organizations for the past 15 years and I can tell you there are
significant costs and reporting requirements. To start with, the IRS is
trying to cut down on the people who are attempting to set up fraudulent
non profit organizations by imposing a non refundable fee of $500 (pass
or fail) to file your initial paperwork for consideration as a non
profit. Secondly as a 501(c)(3) you are considered to be a publicly
supported charity and must perform and pass a complicated public support
calculation each year to show that majority of your support comes from
the public at large. You would probably want to set up as a 501(c)(4)
non profit membership organization. The paperwork is a little easier but
the fees still apply. Also any donations made to the organization are
not deductible by the donor on their income tax form. Your best bet is
to hook up with the non profit organization that sponsors your troop to
avoid the headaches
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