{"id":1051,"date":"2018-05-31T19:50:17","date_gmt":"2018-05-31T19:50:17","guid":{"rendered":"http:\/\/amerilawyer-blog.local\/?p=1051"},"modified":"2018-09-10T15:08:21","modified_gmt":"2018-09-10T15:08:21","slug":"non-profit","status":"publish","type":"post","link":"https:\/\/www.amerilawyer.com\/blog\/non-profit\/non-profit","title":{"rendered":"Non Profit Organizations and 501 C3 Exemption"},"content":{"rendered":"<h1>Non Profit\u00a0 and 501 C 3 FAQs<\/h1>\n<p><em>Lets talk about Non Profit\u00a0 and 501 C3 organizations and where to start them for a minute.\u00a0 We are going to answer the following questions: <\/em><\/p>\n<ol>\n<li><a href=\"#difference-non-profit-and-501c3\">Is there a difference between a non profit and\u00a0501 C3?<\/a><\/li>\n<li><a href=\"#process-to-set-up-non-profit\">What is the process to set up a non profit organization?<\/a><\/li>\n<li><a href=\"#how-many-people-do-you-need-to-set-up-a-non-profit\">How many people do you need to set up a non profit organization?<\/a><\/li>\n<li><a href=\"#purchase-property-affect-my-tax-exempt-status\">Can I purchase property and not affect my tax exempt status?<\/a><\/li>\n<li><a href=\"#where-should-i-start-my-business\">Where should I Start my business? Can I set up my business in any state; or does it have to be in the state I live in?<\/a><\/li>\n<li><a href=\"#separate-bank-account-for-your-business\">What will happen if I don&#8217;t have a separate bank account for the business? Can they go after my personal money?<\/a><\/li>\n<\/ol>\n<p><iframe loading=\"lazy\" src=\"https:\/\/www.youtube.com\/embed\/Lb3nPlBmvLQ\" width=\"480\" height=\"270\" frameborder=\"0\" allowfullscreen=\"allowfullscreen\"><span data-mce-type=\"bookmark\" style=\"display: inline-block; width: 0px; overflow: hidden; line-height: 0;\" class=\"mce_SELRES_start\">\ufeff<\/span><\/iframe><a name=\"difference-non-profit-and-501c3\"><\/a><\/p>\n<h1>1. What is the Difference Between a Non Profit and a Tax Exempt 501 C3?<\/h1>\n<p>When we refer to a non profit organization, we are referring to any organization formed and organized for an non profit purpose. A 501 (c) (3) is a recognition by the IRS that the organization is now exempt from all income taxes. Tax exempt however, is merely the result of the non-profit being recognized. Most tax exempt companies are non-profit organizations set up for charity, religious, literary, or educational purposes.<\/p>\n<ul>\n<li>A <strong>non profit<\/strong> <strong>corporation<\/strong> is a business entity incorporated at the state level where there are no equity owners that hold shares of stock. Also, none of the corporate income is distributive to members, directors, or officers. Instead, such non-profit corporations typically are controlled by members that elect a board of directors.<\/li>\n<li><strong>Tax exempt 501(c)(3)<\/strong> non-profit corporations are classified as either a public charity or a private foundation. Generally, organizations that are classified as public charities are those that are churches, hospitals, qualified medical research organizations affiliated with hospitals, schools, colleges and universities; have an active program of fundraising and receive contributions from many sources, including the general public, governmental agencies, corporations, private foundations or other public charities; receive income from the conduct of activities in furtherance of the organization\u2019s exempt purposes; or actively function in a supporting relationship to one or more existing public charities.<br \/>\nPrivate foundations, in contrast, typically have a single major source of funding (usually gifts from one family or corporation rather than funding from many sources) and most have as their primary activity the making of grants to other charitable organizations and to individuals, rather than the direct operation of charitable programs.<\/li>\n<\/ul>\n<p><a href=\"#top\">Back To List of Questions<\/a><\/p>\n<p><a name=\"process-to-set-up-non-profit\"><\/a><\/p>\n<h1>2. What is the process to start a non profit company?<\/h1>\n<ul>\n<li>\u00a0First thing is that you would need to file with the state and organize your business so that you can receive your articles of incorporation.<\/li>\n<li>As soon as you receive the articles of incorporation, register the company with the IRS.\u00a0 This is so that you will be recognized as a tax exempt organization.<\/li>\n<li>Its important to file the articles with the IRS as soon as possible because you will need to answer many questions about your organization.\u00a0 If you complete the questions early, you would have to answer less questions regarding your business, because there is less information to process.\u00a0 The longer you wait, the more questions you will have to endure which can make the process a longer one.<\/li>\n<li>You should then receive a letter of determination from the IRS with in two to six months, and\u00a0 your business should be ready to go.<\/li>\n<\/ul>\n<p>If you&#8217;re not sure about what to do or seem to have a hard time with the process and you are ready to start, we can help you create your <a style=\"background-color: #ffffff;\" href=\"http:\/\/www.amerilawyer.com\/form_a_non_profit_corporation\/non_profit_corporation.htm\">non-profit organization. <\/a><br \/>\n<a href=\"#top\">Back To List of Questions<\/a><a name=\"how-many-people-do-you-need-to-set-up-a-non-profit\"><\/a><\/p>\n<h1><strong>3. Do I need a specific amount of people to create my non profit organization?<\/strong><\/h1>\n<p>Because a non-profit organization, a total of 3 people must direct the entity.\u00a0 You have been given the power of a tax free business.\u00a0 The benevolent purpose must be carried out by all three members of the company.\u00a0 A non-profit organization retains all money from the business.\u00a0 But don&#8217;t forget, that you still have administrative expenses and salary.<\/p>\n<p><a href=\"#top\">Back To List of Questions<\/a><a name=\"purchase-property-affect-my-tax-exempt-status\"><\/a><\/p>\n<h1>4. Can I purchase property with out affecting my tax exempt status?<\/h1>\n<p>It is time to purchase a secondary building for the business. Can you purchase a new building without it affecting your tax exempt status? The answer is yes.\u00a0 It is advisable however, to create a<a href=\"http:\/\/www.amerilawyer.com\/form_a_limited_liability_company\/limited_liability_company.htm\"><strong> multi member LLC for the corporation<\/strong><\/a>.\u00a0 You could purchase the building through the multi member LLC, and lease the building to the non-profit organization.<\/p>\n<p>This way there are many advantages to both entities.\u00a0 The multi member LLC would receive an income.\u00a0 \u00a0The depreciation of the building with off set the rent income.\u00a0 Leasing the building to the non profit organization could result in the appreciation of the building which will be to the advantage of the LLC in the years to come.\u00a0 It is important to discuss that the lease must adhear to a few rules.\u00a0 The lease must be at fair market value as indicated by an appraisal, and it must be an at arms length transaction with full disclosure.<\/p>\n<p><a href=\"#top\">Back To List of Questions<\/a><\/p>\n<div id=\"attachment_1123\" style=\"width: 310px\" class=\"wp-caption alignnone\"><a href=\"http:\/\/amerilawyer-blog.local\/wp-content\/uploads\/2018\/05\/240_F_149937274_EgJHQXA9Yd1Q3S92aEFGPCPgSOCcPD6U.jpg\"><img loading=\"lazy\" decoding=\"async\" aria-describedby=\"caption-attachment-1123\" class=\"wp-image-1123 size-medium\" src=\"http:\/\/amerilawyer-blog.local\/wp-content\/uploads\/2018\/05\/240_F_149937274_EgJHQXA9Yd1Q3S92aEFGPCPgSOCcPD6U-300x200.jpg\" alt=\"non profit\" width=\"300\" height=\"200\" srcset=\"https:\/\/www.amerilawyer.com\/blog\/wp-content\/uploads\/2018\/05\/240_F_149937274_EgJHQXA9Yd1Q3S92aEFGPCPgSOCcPD6U-300x200.jpg 300w, https:\/\/www.amerilawyer.com\/blog\/wp-content\/uploads\/2018\/05\/240_F_149937274_EgJHQXA9Yd1Q3S92aEFGPCPgSOCcPD6U-144x96.jpg 144w, https:\/\/www.amerilawyer.com\/blog\/wp-content\/uploads\/2018\/05\/240_F_149937274_EgJHQXA9Yd1Q3S92aEFGPCPgSOCcPD6U.jpg 360w\" sizes=\"auto, (max-width: 300px) 100vw, 300px\" \/><\/a><p id=\"caption-attachment-1123\" class=\"wp-caption-text\">Non Profit Organization<\/p><\/div>\n<p>&nbsp;<\/p>\n<h2>___________________ Additional FAQs_______________________<\/h2>\n<p><a name=\"where-should-i-start-my-business\"><\/a><\/p>\n<h1><strong>5. Where should I start my business; does it have to be formed in the state where I live?\u00a0 Can I choose which state I set it up in?<\/strong><\/h1>\n<p>When considering where to set up a business, you must entertain all ideas about laws and regulations of businesses. Yes you can set up a business anywhere. There is however, a way to go about it.\u00a0 Many times the it may be that the business owner would want to open the business in another state.\u00a0 Nevada, for example, offers asset protection.\u00a0 Because there are so many choices, you may want to speak to a legal representative to decide which of the many options are right for you.\u00a0 Perhaps, an entrepreneur would set up his business in Delaware because of it anonymity and it background history of business law.\u00a0 Most new business owner do not mind paying the cost to be qualified.\u00a0 With the costs, state offers them asset protection.<\/p>\n<p><a href=\"#top\">Back To List of Questions<\/a><a name=\"separate-bank-account-for-your-business\"><\/a><\/p>\n<h1><strong>6. What will happen if I don&#8217;t keep my business expenses and personal expenses separate?<\/strong><\/h1>\n<p>When you open your new business, you should immediately open your new bank account under the business name.\u00a0 It is also important to make sure that you keep records on your business expense.\u00a0 The problem many new entrepreneurs have is where do I get the money to finance my brand new business?\u00a0 You can loan money to your business and pay yourself back. Another option is to invest in your business.\u00a0 By placing your company&#8217;s money in an account, you are also creating a protection against any type of liability that may come up.<\/p>\n<p><a href=\"#top\">Back To List of Questions<\/a><\/p>\n<h3>Final Thought: Procrastination is the number one enemy of the entrepreneur.<\/h3>\n<h3><iframe loading=\"lazy\" src=\"https:\/\/www.youtube.com\/embed\/Lb3nPlBmvLQ\" width=\"560\" height=\"315\" frameborder=\"0\" allowfullscreen=\"allowfullscreen\"><\/iframe><\/h3>\n<h1>ARE YOU READY TO START YOUR BUSINESS?<\/h1>\n<h2><b>INCORPORATE TODAY AT <a href=\"http:\/\/www.amerilawyer.com\">WWW.AMERILAWYER.COM<\/a><\/b><\/h2>\n<p><strong>Not Ready? Have More Questions?<\/strong><br \/>\nIf you are a member of Spiegel &amp; Utrera, P.A.\u2019s\u00a0<a href=\"http:\/\/www.amerilawyer.com\/general_counsel.htm\"><b>General Counsel Club<\/b><\/a><b>\u00a0and have business\u00a0related questions, call (800) 734-9900 or C<\/b><b>lubAssist@AmeriLawyer.com<\/b><b>\u00a0for assistance. Remember, as a member of the \u00a0General Counsel Club, you receive unlimited legal, business, credit and tax advice all year long.<\/b><\/p>\n<p><em>Spiegel &amp; Utrera, P.A. is a corporate law firm with its main offices located in Miami, Florida with offices throughout the U<\/em><span class=\"text_exposed_show\"><em>nited States. As a law firm, we do more than just help you form your business entity. We stand ready to help with the maintenance of your legal business entity! We\u00a0will assist you with\u00a0<a href=\"http:\/\/www.amerilawyer.com\/form_a_corporation\/corporation.htm\" target=\"_blank\" rel=\"noopener\">Incorporation Service<\/a>,\u00a0<a href=\"http:\/\/www.amerilawyer.com\/trademark\/index.htm\" target=\"_blank\" rel=\"noopener\">Trademarks<\/a>,\u00a0<a href=\"http:\/\/www.amerilawyer.com\/trademark\/tm_copyright.htm\" target=\"_blank\" rel=\"noopener\">Copyrights<\/a>,\u00a0<a href=\"http:\/\/www.amerilawyer.com\/living_trust.htm\" target=\"_blank\" rel=\"noopener\">Estate Planning<\/a>,\u00a0<a href=\"http:\/\/www.amerilawyer.com\/general_counsel.htm\" target=\"_blank\" rel=\"noopener\">Legal Counsel<\/a>,\u00a0<a href=\"http:\/\/www.amerilawyer.com\/assetprotection\/index.htm\" target=\"_blank\" rel=\"noopener\">Wills<\/a>,<a href=\"http:\/\/www.amerilawyer.com\/livingtrusts\/index.htm\" target=\"_blank\" rel=\"noopener\">Trusts<\/a>,\u00a0<a href=\"http:\/\/www.amerilawyer.com\/agreements\/\" target=\"_blank\" rel=\"noopener\">Agreements &amp; Leases<\/a>,\u00a0<a href=\"http:\/\/www.amerilawyer.com\/\" target=\"_blank\" rel=\"noopener\">Corporate &amp; Company<\/a><\/em><\/span><\/p>\n<div class=\"addtoany_share_save_container addtoany_content addtoany_content_bottom\">\n<div class=\"a2a_kit a2a_kit_size_16 addtoany_list\" data-a2a-url=\"https:\/\/amerilawyer-blog.local\/business\/nonfrofit\/registration-requirements-before-charitable-solicitation\/\" data-a2a-title=\"Registration Requirements Before Charitable Solicitation\"><\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":null,"protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[83],"tags":[],"class_list":["post-1051","post","type-post","status-publish","format-standard","hentry","category-non-profit"],"_links":{"self":[{"href":"https:\/\/www.amerilawyer.com\/blog\/wp-json\/wp\/v2\/posts\/1051","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.amerilawyer.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.amerilawyer.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.amerilawyer.com\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.amerilawyer.com\/blog\/wp-json\/wp\/v2\/comments?post=1051"}],"version-history":[{"count":0,"href":"https:\/\/www.amerilawyer.com\/blog\/wp-json\/wp\/v2\/posts\/1051\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.amerilawyer.com\/blog\/wp-json\/wp\/v2\/media?parent=1051"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.amerilawyer.com\/blog\/wp-json\/wp\/v2\/categories?post=1051"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.amerilawyer.com\/blog\/wp-json\/wp\/v2\/tags?post=1051"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}