Charity Registration Demystified

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What is Charity Registration? This presentation covers all you need to know about charity registration for nonprofits and charities. The slides cover what is charity registration, why comply with the laws, where do you register, what is a solicitation, how do you register, and where to find more information.

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Charity Registration Demystified

  1. 1. Charity Registration Demystified Nonprofit Technology News Tony Martignetti, Esq. Martignetti Planned Giving Advisors, LLC April 17, 2013
  2. 2. Where We’re Headed • What is Charity Registration • Why comply with the laws • Where do you register • What is a solicitation • How do you register • Plan for how to get going • Continuing Ed. 2
  3. 3. What Is Charity Registration Requirements throughout the states and D.C. that charities register with authorities--or be exempt--everywhere they solicit 3
  4. 4. Why Comply With The Laws • IRS Form 990 • Criminal & civil penalties, e.g.: -- FL: 3rd degree felony; 5 yrs/$5000 & narrow exemptions -- AZ: Class 1 misdemeanor & scant exemptions -- IL: civil fine; $500 to $1,000 -- PA: 1st degree misdemeanor; $10,000; 5 years -- GA: civil fine; $25,000 -- NJ: civil penalty up to $10,000 -- DC: civil fines, penalties, fees -- VA: misdemeanor; 1 yr/$1000 fine 4
  5. 5. Why Comply With The Laws • Board member liability -- Fiduciary duty • Gift challenge from donor or heir -- Disgruntled donor hires enterprising attorney • Right thing to do: operate within the laws 5
  6. 6. Where We Are √ What is Charity Registration √ Why comply with the laws • Where do you register • What is a solicitation • How do you register • Plan for how to get going • Continuing Ed. 6
  7. 7. Where Do You Register Everywhere you solicit, except where you’re exempt 7
  8. 8. What Is A Solicitation • Varies state to state • A few neat categories 8
  9. 9. What Is A Solicitation • Mere existence of website accepting donations: “Donate Now” button - Passive solicitation - DC, VA, FL, AZ, NY, IL, PA, GA, others 9
  10. 10. What Is A Solicitation • Website accepting donations + induce donors to it - email, US mail, phone, ads, meetings, etc. - Active solicitation - CA, TX, MD, UT, WA, WI, others 10
  11. 11. What Is A Solicitation • Ask for charitable support by - Email - US Mail - Meetings - Events - Advertisements • These are a solicitation in nearly every state 11
  12. 12. Even If You Are Soliciting • You might be exempt • Exemptions vary drastically across states -- Mission, with qualifications -- Gross revenue -- Gross fundraising revenue -- Revenue from within the state (kindest) 12
  13. 13. Where We Are √ What is Charity Registration √ Why comply with the laws √ Where do you register √ What is a solicitation • How do you register-Forms, Docs, Fees • Plan for how to get going • Continuing Ed. 13
  14. 14. How Do You Register-Forms • Vary drastically across the states • Unified Registration Statement (URS) • A few neat categories - URS - URS + state forms - Non URS: state forms only --”foreign corp doing business” 14
  15. 15. How Do You Register-Docs Typical documents - By laws & articles of incorporation - Tax exempt letter - Board list - Financial report - IRS Form 990 15
  16. 16. How Do You Register-Fees • A few neat categories - Flat - Tiered by gross revenue or contributions - Tiered by in-state revenue (kindest) • HI most expensive: $750 for largest • 5 free: AZ, AR, KY, MI, NM • 32 ≤ $100 16
  17. 17. Where We Are √ What is Charity Registration √ Why comply with the laws √ Where do you register √ What is a solicitation √ How do you register • Plan for how to get going • Continuing Ed 17
  18. 18. Plan For How To Get Going-1 • Charity starts at home -- so does enforcement --- examples in FL, GA, AZ, WA -- register there 18
  19. 19. Plan For How To Get Going-2 • Very high fundraising revenue states, if any - dollar amount - percentage of fundraising revenue 19
  20. 20. Plan For How To Get Going-3 Web-Based Fundraising • Do you need every state? -- if not, take safe harbor & restrict giving • Where solicit most -- descending state populations --- census.gov -- work down the list 20
  21. 21. Plan For How To Get Going-3 Non Web-Based Fundraising • Where solicit most -- query database for constituent frequency by state -- descending order of frequency -- work down the list 21
  22. 22. Plan For How To Get Going-4 • Don’t be intimidated or overwhelmed • Follow a plan • One to three per month • May be exempt in some -- need to apply for exemption? • You can do this 22
  23. 23. Continuing Education • http://www.nasconet.org • URS, http://www.multistatefiling.org • My blog, http://www.tonymartignetti.com --Tony Martignetti Nonprofit Radio -- LinkedIn, Twitter, YouTube, Facebook -- Email sign-up for weekly radio alerts 23
  24. 24. Continuing Education My book: Charity Registration: State-by-State Guidelines for Compliance --http://tonymartignetti.com/charity-registration 24

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