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Entrepreneurship:  Business or Non-Profit  |
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Tracey
True Blue Farmgirl
766 Posts
Tracey
State of Confusion
USA
766 Posts |
 Posted - Sep 30 2007 : 11:35:58 AM
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In my post in the Barnyard regarding horse rescues, Winona said she had run hers as a business rather than non-profit. I believe her accountant had recommended that as the IRS dogs non-profits pretty closely.
By running a rescue as a business, you can deduct your expenses. However, people cannot deduct contributions unless they're giving to a 501c.
My question to all of you is whether or not you'd give to a business (or even private party) without a legitimate non-profit status?
Check out the new designs at my Cafe Press Store!
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http://carpentercreek.wordpress.com |
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willowtreecreek
True Blue Farmgirl
4813 Posts
Julie
Russell
AR
USA
4813 Posts |
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HAINAngel2000
True Blue Farmgirl
157 Posts
Mary
Sweet Home
OR
USA
157 Posts |
Posted - Sep 30 2007 : 6:42:08 PM
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Running a non profit myself I know you cannot receive financial donations and offer a receipt with out the status. To ask for a donation of a financial kind I think you have to have a status. However really this is best asked by an attorney or someone who knows all the laws on this. If you have a business I wonder if you could sell things and what you do with profits is up to you. But far as asking for donations this I would be careful with.
Hope this helps!!
Mary
Let me know if you have any questions or need anything. I am happy to help!
Website: http://heavenlyangelsinneed.com
Email: info@heavenlyangelsinneed.com
Bereavement: http://Heavenlyangelsinneed.org
Blog: http://Heavenlyangelsinneed.blogspot.com/ |
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Tracey
True Blue Farmgirl
766 Posts
Tracey
State of Confusion
USA
766 Posts |
Posted - Sep 30 2007 : 7:37:46 PM
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Mary, how difficult was it to set up a non-profit, and is there a lot of red tape?
If I went the business route, I could of course sell things and put the profit into the 'business'. However, I would be concerned that people would feel that they were financing a horse trader rather than a legitimate rescue.
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http://cafepress.com/mustangfever
http://carpentercreek.wordpress.com |
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HAINAngel2000
True Blue Farmgirl
157 Posts
Mary
Sweet Home
OR
USA
157 Posts |
Posted - Oct 01 2007 : 10:42:45 AM
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Tracey, Well it wasn't super hard to get it, my husband and myself did it ourselves. But there are alot of things we didn't realize we needed to do after we got our status and what all we have to do every year. Its not as hard as you would think though!
First step is to go to your state website and sign up to get your non profit incorperation papers, in our state was 50 bucks. You will then be recognized in your state. Make sure to start keeping your financial records etc.. we waited 8 months before we applied for our federal (I think you have to wait at least 8 months) then fill out federal paperwork. I wish you were here so I could show you first hand what all you need. Its not super hard just confusing to tell you over this lolol
Did you know you have to fill out a 990 if you apply for the state non profit incorperation (which you need before you can do the federal) even if you have not been approved yet? Anyway you also need to spply for an EIN number (its free) you will need this number to apply I think for both.
my email info@heavenlyangelsinneed.com you can write me with more specific questions to answer if you wish!
When you get a status you will be more open to grants to help your cause. You will be more open to receive help from volunteers. My best advise would be to have a professional website and a forum (a place to allow people to join, ask questions and get answers) you can get help from all around. It is allot of work, but its satisfying. If you beleive in what your mission is you will be happy you did it, its worth the work. There is not allot of Red tape as much as one would think. Its basically just learning the basics of laws or how to's. There are many lawyers out there that can help you and some will do it free!
Hope this helps. Remember email me if you have specific questions. -Mary
Website: http://heavenlyangelsinneed.com
Email: info@heavenlyangelsinneed.com
Bereavement: http://Heavenlyangelsinneed.org
Blog: http://Heavenlyangelsinneed.blogspot.com/ |
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KYgurlsrbest
True Blue Farmgirl
4853 Posts
Jonni
Elsmere
Kentucky
USA
4853 Posts |
Posted - Oct 01 2007 : 11:09:51 AM
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A few things in response...
If I donate, it's nice to be able to donate to a 501 C 3 (or non-profit) but that doesn't make my decision for me. Often, there are a number of great organizations who don't really make any profit because of the actual output of funds, but don't want to deal with the IRS issues of the non-profit....
Personally, I was involved in a non-profit organization that obtained donations for an animal shelter. We were not associated with the shelter, per se, but we could utilize funds for any medical help they might require, food donations, what have you.
This is what I do for the law practice I work for--help businesses, both non-profit and profit get started....
Now, Mary is correct--
first you need to apply for your Articles of Incorporation (Non-Profit), which should be cheaper than the regular Articles of Incorporation (usually a recording fee of $50.00) because of the non-profit status. This you would do with your Secretary of State. You can usually find the forms online--you will need to designate an Agent of Process (i.e., someone who will be notified in the event of any corporate mailing, or service for lawsuit). You will need to figure out who your directors and secretaries are. That all goes on the form. Usually, you'll file it in triplicate, and then file it with your local County clerk's office when you get back two copies from the Secretary of State.
After receiving the fully recorded Articles, you can apply for your EIN number online, through the IRS. This is your Tax Identification Number.
After obtaining your EIN number, you can send in your IRS Form for non-profits and charitable organizatinos. BEWARE, the application for non-profit status is a DOOZY. Half of it doesn't apply, but good lord, you have to read it all to make sure (2 times) ;) They are usually pretty good about getting back to you right away with any problems or changes they want made.
Hope this helps, and best of luck!!!!
"She was built like a watch, a study in balance ... with a neck and head so refined, like a drawing by DaVinci"...
NY Newsday sportswriter Bill Nack describing filly, Ruffian. |
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Entrepreneurship: Business or Non-Profit |
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Business or Non-Profit
