5 Things to Keep in Mind When Filing as a Nonprofit
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Considering filing your startup as a nonprofit? Nice! Good to hear you want to change a world. The process itself can be a bit different though... so keep these five things in mind.
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5 Things to Keep in Mind When Filing as a Nonprofit
- 2. Filing your business as a nonprofit makes it eligible for a number of perks and restrictions that may not immediately come to mind. If you're already thinking about launching your startup as a nonprofit organization, it probably already meets some of the initial criteria. But before doing so, make sure that you're ready! Keep these five things in mind during the process: So, you're thinking of a nonprofit?
- 4. Make sure your company meets meet the IRS’s definition of a 501(c)(3) organization! The IRS considers an NPO to be charitable, educational, literary, religious, or scientific (among other things!) Don't forget that while you can pay your employees, you cannot make a profit. You are also not allowed to give earnings to private shareholders.
- 6. In a nonprofit, founders are typically expected to share leadership with at least one other person. This is often in the form of an advisory council or a board of directors. Give up the reins!
- 8. Stay one step ahead in your accounting. Nonprofits can be subject to auditing from either the IRS or the Board, so make sure all your bases are covered when it comes to sharing information. And be honest!
- 9. 4. PERKS
- 10. Benefits that come with being an NPO include tax-exempt status, or discounts on postage and tools. The organization may also receive invitations to special events!
- 12. When you run an organization that makes a positive impact, the biggest benefit is the rewarding nature of the work itself. People who work for nonprofits often find gratification beyond the salaries they are paid when they see the fruits of their labor. When you work at a company that changes lives, seeing that you make a difference in the world is an incredible feeling.