[freegeek-startup] Filling out paperwork for a 501(c)(3) - Please need help, advise, or suggestions

[Iain (FreeGeek) Davidson]

Shawn,

>From my own experience of diving into this issue, here's some pretty solid
points discovered.

* Board members can't be paid for being on the board.
(But can be compensated for expenses for getting to meetings or using
supplies, etc)

* Main members of the organization, who are being paid for work done in the
organization, CAN be on the board.

* Boards typically are 5 to 11 people, comprised of members of the community
and the business.

* Filing for state/city non-profit business status, is straight forward.
And typically just takes a business license and $25 to $50.

* Filing for IRS 501(c)3, tax exemption is NOT quick.  You will file for
'provisional' status, then 5 to 6 years later will be granted full status.
(At which time, then people can write their donation off taxes).

* Sometimes it's easier to partnership with other local non-profits who
already have tax-exempt status.  If you already have an agreement of
payment/expenses, it might work to have customers donate to them, then work
out a fair trade back in goods and services (be very careful and intentional
about this for the financial books).

* ABOVE ALL, when you have all your ducks in a row, seek legal council
BEFORE filing any paperwork and setting items in stone.

I might suggest too, looking at the existing paperwork/applications that
several freegeek's have  generously offered available online.

Here's only some of the many examples available,
(with Wiki codes included. :)  From one of the pages I'm developing for FG
Bellingham)

Portland
* [http://wiki.freegeek.org/index.php/Free_Geek%27s_status_as_a_nonprofit NP
Status]

FG Columbus:
* [
https://freegeekcolumbus.org/trac/fgcmh/file/documents/legal/IRS/FGCMH-1023.pdf?rev=25&format=rawPDF
from the IRS]
* [
https://freegeekcolumbus.org/trac/fgcmh/file/documents/legal/IRS/FGCMH-1023_attachments.odt?rev=25&format=rawOpenOffice
2.0 OpenDocument file.]
* [http://freegeekcolumbus.org/archives/fgcmh/2006-July/001452.html Answers
to common questions]


== Other IRS Form 1023 Resources ==
{|

|-
| A basic overview of some of the stumbling points on the form.
|  http://www.form1023help.com/

|-
| A $37 e-book with detailed information about the new 2006 IRS 1023 form.
|  http://www.501c3book.com/

|-
| A business Plan howto.
|  http://www.tess.org/misc/010708NP_Biz_Plan.pdf

|-
| Here's a 1023 from 2004, with attached schedules available for review.
The form is different now, but helpful to see a filled-out form plus
attachments.
| http://www.eogeo.org/About/records/records_us/us_federal/us_irs/irs_1023/

|-
| Other sites :
|  http://www.charitychannel.com/<br>
http://www.volunteertoday.com/
|}

Resources for non-profit status filing.
* Whatcom Non-profits: http://www.whatcomnonprofits.org/

* http://www.hurwitassociates.com/
:Good information about non-profits.

Good luck!
-Iain
aka FG Bellingam

On 8/9/06, Jim Craner <jim at chicagotech.org> wrote:
>
> Hi Shawn,
>
> I think the rules for compensation for board members and similar
> situations is
> variable by state - and you should *definitely* check with someone who
> knows
> for sure, like your state attorney general's office.
>
> I sit on a couple of boards in Illinois, one of which will eventually
> become
> FREE GEEK Chicago, and on both of them we have decided that board members
> will not receive any compensation just to avoid these issues.
>
> Here in Chicago there is a project staffed by pro bono lawyers that
> assists
> existing NPOs with legal issues, and also helps people launch new NPOs
> correctly, doing all the paperwork, by-laws, etc.  You can see if there's
> something similar in your state/city.
>
> Hope this helps and best of luck from the FG/Chi crew!
> -Jim
>
>
> On Tuesday 08 August 2006 19:11, Shawn Campbell wrote:
> > Richard brought up a good point about asking for advise or help in
> filling
> > out the paperwork for a 501(c)(3). So I am asking for it. I am planning
> on
> > filling out the paperwork starting this weekend when I get back from my
> > last business trip.
> >
> > I have a good grasp of what a non-profit organization is, and some
> basics
> > of how they need to be ran.
> >
> > One other question I did come across. It says in a lot of the
> documentation
> > that I have read is that revenues are NOT to go to a sole person, or
> board
> > members outside of reasonable reimbursements. It is not quite clear if
> you
> > can pay board members for their time serving or not. Or here is another
> > situation, let's say I am the project coordinator AND serve on the board
> in
> > some way. Does that mean that I cannot collect a pay check?
> >
> > Regards...
> >
> > Shawn
>
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