What Are the Key Steps in Establishing a Nonprofit Organization?
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Transcription
There are four key steps in establishing a nonprofit organization.
First, you want to establish your entity, getting it on record with the Secretary of State’s office.
Second, filing an application for tax exempt status with the Internal Revenue Service and then of course making sure that you comply with state charitable laws. Here in Illinois that registering with the Charitable Trust Bureau of the Illinois Attorney General’s office.
Lastly, for organizations that qualify, you certainly want to apply for a sales tax exemption. That exemption doesn’t come automatically with the exemption from federal income tax is granted to you by the IRS and followed by the state for the exemption from state income tax.
Exemption from sales tax require a separate application. Many clients are not aware of that or they fail to include provisions within their governing documents or the IRS application that would put them in a position to be able to qualify for a sales tax exemption.