Becoming a Nonprofit Organization

It is important for organizations to make a profit, in order to fulfill its mission. Even if a nonprofit organization makes a profit, it has no owners and all funds go back into maintaining the organization. Organizations may file for a nonprofit status through the Internal Revenue Service (IRS) to receive tax-exempt benefits.

Organizations have the opportunity to incorporate as a nonprofit in any state. The rules to incorporate vary from state to state, but each state requires Articles of Incorporation. Within the articles the organization must state its registered agent and office to receive legal notifications. The address must be a physical address in your state and not a PO Box. If you do not wish to list a home address, there are registered agent services available to receive legal notifications. Contact your state office to learn more about the requirements to incorporate.

The Articles of Incorporation also includes the federal tax-exempt status the organization will file to become tax-exempt under the Internal Revenue Code. A list of these codes are located at:

https://www.irs.gov/publications/p557#en_US_201801_publink10002273

Even though this list includes several codes to file a 501 (c) tax-exempt status, the most common filings include 501 (c)(3) and 501 (c)(6). Organizations filing as 501 (c)(3) are identified mainly as charitable, but include religious, educational, scientific, literary, testing for public safety, to foster national or international amateur sports competition, or prevention of cruelty to children or animals organizations. The main purpose of these organizations is to benefit the public. Organizations may apply for a 501 (c)(3) status if they are either a public charity or a private foundation providing charitable goals.  A key component of an organization maintaining a 501 (c) (3) status is offering donors a tax deduction.

Limitation to a 501 (c)(3) is political activity. A 501 (c)(3) is not allowed to participate in any political activity. However, an organization that is not a private foundation or religious may apply for a 501 (h) election when filing a 501 (c)(3) application and participate in limited lobbying.

Even though 501 (c)(3) organizations may have members, another option is 501 (c) (6).  This status allows organizations to be politically active to promote the mission of its members’. Donations are not tax deductible, but the 501 (c)(6) organization does not rely on donations to run the nonprofit. These organizations include business leagues, chambers of commerce and real estate boards, among others.

Organizations should contact an attorney specializing in nonprofit law with any questions and preparing the filing for nonprofit status.

How One Acronym Can Make All the Difference

The Wisconsin Society of Association Executives (WSAE) held the WSAE Summit last month in Madison. Impact participated by sending one of our executive administrators, Tammy. Tammy reported back that the event was filled with useful learning sessions as well as networking opportunities. From this event, Tammy had one major takeaway, everyone needs micro goals. The keynote speaker, Connor Cunneen, emphasized an acronym, C.H.A.P.S, to live by in both work and your personal life to create those micro goals.

C- Compliment one person each day. This sets a positive attitude for both people involved. Setting that tone can lead to a more efficient working relationship and work environment.

H- Hear the words “Thank You.” If you do something nice for someone, it is important to slow down to hear their thank you. This will help you to keep in mind that your work is important and making an impact. This can keep you motivated to provide your best work again and make you feel fully appreciated.

A-Address colleagues, members, and customers by name. The most impactful word to someone is their name. If you are trying to make that person feel important or attempting to get a point across that you do not want them to forget, add their name to the sentence. It will stick with them and emphasis the point you are intending to make.

P-Positive. Use one positive word in each conversation. Delightful, Friendly, Amazing, Brilliant, Bubbly are examples of words that have a significant impression on the person you are speaking with. Adding those words in while giving constructive criticism can also help ensure that the person hears your message rather than shutting down to the negative feedback.

S-Smile. Put a smile on one person’s face each day. When you make someone smile, you in return smile. Create a positive atmosphere and bring a little joy to days that can often blur together with busy schedules and routine.

Living by the CHAPS acronym can make a difference in relationships in all areas of your life. Building those relationships adds to both your success and happiness. This way of thinking is one that we are excited to begin incorporating into our culture at Impact Services.