Starting your own nonprofit corporation
In August 2006 legislative changes were passed placing restrictions on donor advised funds. Previously a donor who wished to financially support and carry out his or her own charitable program could do this under a support organization, sharing its tax ID and tax exempt status. This is no longer the case. It is now important for the entrepreneurial philanthropist to understand other organizational options available which allow them to legally finance and manage their charitable works. One solution is to create a nonprofit corporation, commonly referred to as 501(c)(3).
Benefits of a public charitable corporation
In order to finance and manage your own charitable works you must be organized as a nonprofit corporation. Some of the benefits include: Tax Exempt: exempt from paying state and federal income taxes on most activities Ability to receive donations: fundraise from public and private sources, providing a tax deduction to your donors Protection from personal liability: once incorporated, members usually can not be held personally liable similar to a for profit corporation, Principals can also be employees: providing the ability to finance and manage your charity The disadvantage of a nonprofit corporation is the level of paperwork involved and the complicated issues surrounding the incorporation process and on-going management and compliance. That’s where CAI can help!
Charity Admin, Inc. Services
You don’t have to do it alone. We can assist you in successfully starting and managing your organization. Here at CAI we are your partner, providing the management expertise and the network of a larger organization. We can guide you through the process and we bring a network of experts and years of experience in running nonprofit organizations. We take the worry out of the administration so you can focus on the work of the charity.
We can provide assistance in all phases of the life cycle of your organization: Initial Setup
Incorporation Expertise Obtaining tax exempt status State registration process Federal registration process Development of a strategic plan Creation of an organizational mission statement Leverage volume negotiated prices Graphic design for logos and websites Legal services Hosting of an organizational website
Growth
Establishing an annual budget Creation of a fundraising strategy Execution of a fundraising plan Grant applications Management training Development of human resource policies and position descriptions
On going compliance
Accounting and bookkeeping Receipting donors Processing donations Expense disbursements Maintaining files and records of operations Monthly Bank Reconciliation Information and updates on industry regulations and laws Payroll processing Employment tax filing Assistance in obtaining legal services Organizing board meetings • • •
Pricing
Initial Incorporation $800 plus filing fees Standard Services start at $300 per month Fees subject to negotiation for ~ average balances of $1,000,000 or more ~ fundraising of $100,000 per month ~ one time gifts exceeding $500,000
6201 Leesburg Pike Suite 408 Falls Church, VA 22044 TEL (800) 986-4483 FAX (703) 820-5100 WEBSITE www.cai.com EMAIL cai@nhf.org
Suggested Guidelines for your decision
Let’s say you have what we call CHARITABLE INTENT. For whatever good reasons, and there are lots of them (from immortality to “make the world a better place for us all to live”), you have decided to enter the charitable, educational, scientific or religious arena. And you ask yourself, How can the National Heritage Family help you? Here is some information that will help you decide:
Two Entry-Level Charities These will serve for you as Incubator and Greenhouse.
NHF (DAF): National Heritage Foundation is a Sponsoring Charity that has Donor Advised Funds (DAF) (10,000 project accounts currently impacting lives in 26 countries.) Under the new laws, NHF (DAF) can make gifts to actual charities in the US, and to charitable activities overseas that would qualify as charities if located in the US, with NHF supervision and approval. A DAF CANNOT make any disbursement to ANY individual for compensation or expense reimbursement. CDP (non DAF): Congressional District Programs (CDP) is a non-Donor Advised Fund. It may do all that NHF foundations can do, plus make disbursements of reasonable compensation or expense reimbursement to a NON DONOR (like NHF, CDP may make no distribution whatsoever to a donor). It is, in our parlance, a charitable Field of Activity, guided by a NON DONOR manager, and CDP staff. Entry-Level Charities might be right for you if: • your initial donation is less than $1 million • OR if you believe you can raise funds from the public or from certain donor(s) less than $50,000 per year You might select the entry level assistance, either NHF or CDP whichever is more appropriate for your plans.
An independent Charity: You may be ready for independence, or you may already be an independent charity, desiring top
quality administration. Here is some information that will help you decide: Charity Admin Inc.(CAI): is a Charity Administrator, and can perform complete administrative services for your own independent PUBLIC charity, as listed in our material An Independent Charity might be right for you if: • you are an existing charity, ready for top notch administration (and public status) • you are a growing NHF or CDP project • you may just be beginning your charity now
Please look over our material and call me with questions: Dock Houk, (561)301-3891
APPLICATION: send to at cai@nhf.org fax: (703)820-5100 phone: 703-538-8874 Name:_______________________________________________________________________________________________________ Address:_____________________________________________________________________________________________________ City and Zip:__________________________________________________________________________________________________ Phone home, cell and office:______________________________________________________________________________________ E-mail:_______________________________________________________________________________________________________ Tell us a bit about what you are planning: ____________________________________________________________________________
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6201 Leesburg Pike Suite 408 Falls Church, VA 22044 TEL (800) 986-4483 FAX (703) 820-5100 WEBSITE www.cai.com EMAIL cai@nhf.org