NPO 501c3
_________________________________________________________
JETAA New York
Rob Tuck, President CJ Hoppel, Treasurer
Current Status
(continued)
• Northern CA and NY are currently the only 501c3 organizations (N.CA established 1994) • JETAANY incorporated in 1996 • 2002 – decision not to explore 501c3 • 2005 – new leadership / issue of future GIA • 2006 – granted 501c3 status
Goals / Progress
• Many chapters already incorporated • Looking to get all chapters incorporated, and all chapters 501c3.
Chapters not incorporated? Future plans?
Inc. 501c3
• • • • Chapters encouraged to start 501c3 process Advantage: Bylaws required for GIA Bylaws first step for NPO MoFA funding is temporary
– Original plan: funding = seed money – Purpose: build base & reputation in community
• Rumors re: GIA
– Future funding not guaranteed – Not sudden / instantaneous
• 501c3 status is expected in future
Multiple Forms of NPO
• 501c(3), (4), (6), (7) • JETAA only fits (3) and (7) • (3) = community focused
– Accepts tax deductible donations – Funding from outside sources – Political lobbying not permitted
• (7) = social organization
– Does not accept tax deductible donations – Funding from within membership – Political lobbying OK
Why NPO 501c3?
• Currently – none (or very little) self-generating funds for most organizations. So, why 501c3? • Focus: membership 501c7 – Social Club
– – – – Posting jobs Apartment search network Happy hours Social gatherings
• Focus: community relations 501c3
– All of the above +
• Outreach with local Japanese organizations • Offer scholarships • Grants available for members/students to develop relations with Japan/Asia
Our Decision
JETAANY – 501c3
Social, Jobs & Housing Services + • Maintain long-term options open • Develop scholarship & grant possibilities • Strengthen ties with local Japanese community
501c3 Tools
Bylaws Certificate of Incorporation (EIN #) Business Bank Account Budget Documentation NPO Filing Form Physical Address not affiliated with any individual or organization • Lawyer
– Guide through process – File paperwork
• • • • • •
Steps to NPO
If you have bylaws, a certificate of incorporation, and a JETAA business bank account, your next steps are to:
1- form a small committee 2- find a pro-bono lawyer
Reasons for Multiple Committee Members
• Time
– Extra work to follow through with lawyer and file documents – Added time to meet with committee
• Preserving Information
– Passing info from leadership to leadership – Reasons for past decisions
Lawyer Pros
• Pro Bono Lawyers – no cost / filing cost only • Finding a lawyer
– look in your alumni network for connections
• JETAANY lawyer is JET alumnus
– Contact local firms directly
• Pro Bono lawyers are available by law
Lawyer Cons
• Non-paying clients are low priority • All scheduling is subject to the discretion of the lawyer • If they express willingness to move forward, be flexible with time and accommodate the lawyer’s schedule • Staff turnover – keep good notes! • Longer process than anticipated
Taxes
• Taxes!
– Incorporated organizations required to file taxes regardless of income (GIA = income) – IRS is likely not to go after an organization with income less than $10K – 501c3 government will look at history
• No filings = penalties • Imposed back-taxes for each year of no report • Important to follow tax laws regardless of current or future status
Public vs. Private
• Public vs. Private
– 2 versions of 501c3: public and private – Public is preferred by our lawyers – fewer restrictions – Public = fewer restrictions, but 2/3 of funding must be public
• Government grant $ considered private • JETAANY did not want to solicit money from individual donations or write proposals for grants • Solution: show that GIA is considered public funding
– Build community awareness about Japanese culture – $ not approved for food or drink budgets
• We have to generate 1/3 ourselves – seems like GIA counts against us. Unclear why.
State Laws
• State Laws
– Depends on each individual state NPO requirements – Don’t leave anything out required by law
• EG: Quorum requirement: amount of participation required to make a meeting, motion, or vote official
– Lawyers will help to adapt bylaws early in the process
Voting & Elections
• Procedures for Voting and Elections
– Depends on State
• New York
– all election notifications / ballots must be sent to all membership through the mail – Follow-up by email OK but initial announcement by mail – 10% or 100 member response required (use lower #) – Solution: Board of Directors chooses officers
Choosing Board Members
• All 501c3’s require a Board of Directors
– Anywhere from 3 to 33 people (depending on state requirements) – Appointment Flexible
• Make sure you follow state requirements and your bylaws • Officers OK as Board Members
– Officers can be board members, but the board should consist of more than just the officers. – Officers decide the size of the board and invitations – JETAANY board is mainly former officers
Questions
Q&A
Questions not answered today will be posted by end of August.
Contact us: • Rob Tuck: president@jetaany.org • CJ Hoppel: treasurer@jetaany.org