Doug Hansen Presentation to SECFC13

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Flying right for running your nonprofit.

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Doug Hansen Presentation to SECFC13

  1. 1. Flying Right in Setting Up and Operating Your Exempt Organization
  2. 2. Our focus today will be on 501(c)(3) organizations.
  3. 3.  Q. Why are most nonprofit organizations formed? A. Because someone identifies a need that is not being met, that would be very difficult (if not impossible) to meet by a for profit entity.
  4. 4. Establishing a Nonprofit Organization  Step ONE: Clearly define the mission and prepare a mission statement.
  5. 5. Establishing a Nonprofit Organization - Continued  Step TWO: Evaluation: a. Is there another nonprofit already operating with a similar mission? b. Is the cause one that will allow you to obtain sufficient funding? c. Are you willing to live with a lot of rules? d. Who will benefit?
  6. 6. Establishing a Nonprofit Organization - Continued  Step THREE AND BEYOND:  Choose a name  Prepare and file articles of incorporation  File Form 1023, Application for Recognition of Exemption, with the IRS. How to qualify for 501(c)(3) status…
  7. 7. Establishing a Nonprofit Organization - Continued  Draft bylaws  Recruit and appoint the board of directors  Hold an initial meeting of the board of directors  Obtain licenses and permits  Obtain insurance
  8. 8. Establishing a Nonprofit Organization - Continued  Develop a detailed business plan. Remember that you need to operate like a business!  Adopt a conflict of interest policy  Prepare and adopt compensation policies  Obtain an EIN
  9. 9. Establishing a Nonprofit Organization - Continued  Secure office space  Set up accounting  Develop a budget
  10. 10. Establishing a Nonprofit Organization - Continued  Establish professional service relationships: a. Attorney b. CPA c. Payroll Service Provider d. Banker
  11. 11. Establishing a Nonprofit Organization - Continued  Establish Key Performance Indicators - practical steps 1. Mission clearly defined 2. Strategies defined 3. Action steps defined 4. KPIs to measure accomplishment of action steps
  12. 12. Flying Right  Transparency  Don’t sit on bad news  Communicating your financial message in the best light: a. Form 990 b. Budgets c. Financial Statements d. KPIs
  13. 13. Flying Right - Continued  “No one gives you a dime!” – Peter Brinckerhoff  Annual Filing – Form 990  Acknowledging donations  Restricted donations - tracking and using
  14. 14. Flying Right - Continued  Unrelated Business Income Tax (UBIT)  Excess Benefit Transactions and Intermediate Sanctions  Lobbying
  15. 15. Questions?

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