Acquire 501c3 Non-profit Status

A 501c3 category for non-profit organizations is the most common and broad classification for public charities and foundations organizations such as youth activity programs typically qualify for. These organizations directly coordinate activities related to their proposed charitable mission. There are federal legal obligations for nonprofit organizations and it is important you understand them prior to considering this commitment.IMG_0340

  1. Talk to your school and explore the possibility of utilizing their non-profit status.
  2. Explore and analyze the pros, cons, and costs of incorporating your team into a 501c3 nonprofit entity.
  3. Seek out a local and trusted professional accounting and legal representatives to help you make the decision to become a non-profit organization.
  4. To become a non-profit you must:
    • Incorporate
    • Complete IRS forms including 1023 Form
    • File tax returns
    • Required disclosures
    • Ongoing compliance
  5. Becoming a 501c3 has its benefits that may include:
    • Exemption from federal and/or state corporate income taxes.
    • Possible exemption from state sales tax (each state varies).
    • The ability to apply for grants and other public allocations only available to IRS recognized 501c3 organizations.
    • The public legitimacy of IRS recognition.
    • Discounts on US Postal bulk-mail rates and other services.
    • Tax-exempt financing.
    • Donations to your team can be tax-deductible by the donor.
  6. Find out if your school has a booster club that may already have 501c3 status. If so, contact your Athletic Director to see if your team can apply to join the booster. Joining the school’s booster may be a better option as you already have people in place that know what it takes run this type of organization.
  7. Have patience. Obtaining a 501c3 status can take up to a year but the long-term benefits are worth it.

Resources:

Applying for 501c3 status

Non-profit application instructions

Non-profit exemption example

Non-profit formation list

Interview example for exemption request

Conflict of interest example

Bylaws of a non-profit example

Articles of incorporation example

Board of directors list example

 

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