Guide to Becoming a 501(c)3 Compliant Division/Club
Detailed steps for Divisions/Clubs to achieve 501(c)3 compliance, including reasons to become a non-profit, incorporation process, applying for tax-exempt status, group ruling advantages, requirements for joining a group, and maintaining separate legal entity status.
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Obtaining Non-Profit Status How do all Divisions/Clubs become 501(c)3 compliant
Background Why should every Division/Club be a Non-Profit? Legal Structure Liability Corporate Tax Exemption Charitable Contribution Strategic Plan All Divisions/Clubs obtain 501(c)3 status Approx 25% compliance
Process What is the process to become a 501(c)3 Entity? Incorporate as a non-profit entity in your state Domestic Non-Profit or Public Benefit Corporation Purpose Promotion of Irish Culture Through Sports Articles of Incorporation Certificate of Incorporation Standard Provisions Bylaws Filing Fee
Process What is the process to become a 501(c)3 Entity? Apply to IRS for Employer Identification Number Can be done online Need Social Security Number No Filing Fee
Process What is the process to become a 501(c)3 Entity? Apply to IRS for 501(c)3 status Small Non-Profit Revenue < $50,000 Form 1023EZ Online Large Non-Profit Revenue > $50,000 Form 1023 Paper Format Filing Fee $400 - $850 Language used in application is critical Timeline to receive approval is several months
IRS Group Ruling American Gaelic Games applies to IRS for Group Exemption Ruling All Divisions/Clubs who are part of the Group will obtain Tax-Exempt Status as a 501(c)3 Entity No requirement for Divisions/Clubs to submit Form 1023 Application to obtain 501(c)3 status
Requirements How does a Division/Club become part of the Group? Incorporate as a Non-Profit Entity in your State Obtain Employer Identification Number Enter into Annual Division/Club Affiliation Agreement Compliance with Non-Profit Terms and Conditions Annual Filing of Form 990 Tax Return Administration Fee of $100
Advantages No application to obtained 501(c)3 Maintain Separate Legal Entity Independent Board Control over all Financial Matters Responsibility for Filing Annual Form 990 Tax Return No Impact on Divisions/Clubs currently with 501(c)3
Incorporation Issues Organization has been incorporated under state law as a nonprofit mutual benefit corporation instead of a nonprofit public benefit corporation. Certificate of Incorporation / Articles of Incorporation does not include required Standard Provisions Standard Provisions template provided by attorney Purpose and operation of the Organization No distributions to Officers/Directors No Propaganda / Lobbying Other activities not permitted by 501(c)3 of the IRS Code Dissolution
Timing AGG to file application for IRS Group Ruling by Mid-December Divisions/Clubs wishing to be included must provide updated information by December 1, 2017 Next opportunity to be included will be May 15, 2018
Assistance AGG using Law Firm to file IRS Group Ruling Application Clubs requiring assistance with Incorporation Noel Fleming nfleming@conleyfleming.com (215) 971-8521 Flat Fee of $1,200 plus State filing fees
