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Legal & Practical Implications of Building a Nonprofit

Legal & Practical Implications of Building a Nonprofit. October 5, 2009. Leaders, Visionaries & Social Entrepreneurs. A passion. A community. An idea. Do others share your passion? How is your idea sustainable? Who does it benefit?

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Legal & Practical Implications of Building a Nonprofit

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  1. Legal & Practical Implications of Building a Nonprofit October 5, 2009

  2. Leaders, Visionaries& Social Entrepreneurs • A passion. • A community. • An idea. • Do others share your passion? • How is your idea sustainable? • Who does it benefit? • Do you need to create something new or can you partner with an existing organization? • How do you implement it? -Who is your team? -How do you differentiate your idea/organization?

  3. My Vision

  4. Path • Compton & the Client Community • Training Community Advocates • Making Room for Others • Legal Access Center • Engaging Others • Building Community Investment

  5. Making Room for Others

  6. Legal Access Center

  7. Youth Opportunity Center

  8. Nonprofit Overview • It is a corporation, trust or unaffiliated association authorized under states statutes. • It distributes programs & services for public benefit instead of taxable income to shareholders. • IRS & state tax entities designate the corporation as tax exempt. • In 2008, there were 1.5 million NPO in the U.S. -a 32.7% increase since 1998

  9. Types of Nonprofits Private Charities 51.5% 501(c)(3) Private Foundations 6.1% 501(c)(3) Other Nonprofit Organizations 42.4% • Civic leagues, social welfare orgs, etc. • Fraternal beneficiary societies • Business leagues, chambers of commerce, etc. • Labor, agricultural, horticultural • Social and recreational clubs • Organization of War Veterans • All other 501(c) organizations

  10. Creation • File Appropriate State Documentation Articles Board Members Officers Tax Identification Number • Apply for 501(c) Designation with the IRS • Apply for state tax exemption • Other state requirements: charitable registries

  11. Key Players Incorporators Board of Directors - Governance Officers - Execute Members - Beneficiaries Employees & Agents – Execute

  12. Small Businesses • Unrelated Business Income • Fiduciary Duties Managerial Implementation Board of Director Oversight • Accountability Measurements • Recordkeeping & Accounting • Quality Measures for Delivery • Post-Enron Requirements

  13. Practical Advice Do what you love. Be creative and entrepreneurial. Start small & inexpensively. Build a strong team that supports your vision but can tell you when you need to get out. Assemble a personal board of directors.

  14. Sources Statistics for U.S. Nonprofits http://nccsdataweb.urban.org/PubApps/profile1.php?state=US IRS Guide for 501(c)(3) Applicants http://www.irs.gov/pub/irs-pdf/p4220.pdf

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