How do I start a non-profit organization from home?

Question

I am trying to start a non profit organization to raise awareness to young people at risk of getting hiv/aids.

Answer 1

The IRS has rigid rules for Not-for-Profit businesses.

If you intend to be able to accept donations (and allow the donor to get a tax deduction, you DO need to have IRS approval. The most common form is the 501(c)3, tax exempt organization, organized for charitable purposes.

Here is a brief outline:

These are the basic requirements. Organizing a charitable organization should include a number of operational duties for the survival of the business. At a minimum, these items should include a strategic plan, case statement, articles of incorporation, budget, and set of bylaws.

1) Determine whether you really need to start a charitable enterprise. Would you be better off to filing as a small business or for-profit corporation? Keep in mind that there are many rules and regulations that govern the operation of a nonprofit corporation, depending upon the state in which the business is located. This may include a yearly audit or tax forms to special reporting agencies.

Another thing to consider is that there is usually more administrative paperwork necessary to operate a charitable organization than a for-profit business (sole proprietorship).

You will be asked to define your charitable purpose and will have regulations that will govern the amount of compensation to your board of directors and/or officers.

2) Check with your state business office to determine their requirements

3) Check with the IRS office to file the necessary forms. Determine what type of entity classification you will use. Not all will have tax-exempt status. The most common form is the 501(c)3, tax exempt organization, organized for charitable purposes.

"How do I start?" you asked. Best bet is to call your CPA to file the necessary forms. It won't cost much, and he/she should be experienced in the process. Or, go to www.irs.gov.

Good luck.

Answer 2

Associations may be a good avenue to explore. These organizations will address many of the thoughts, questions and concerns you'll inevitably have as well as many you haven't anticipated yet. See the source box for some relevant links.

Research, research, research – this cannot be stressed enough. Read as much as you can about the industry. Here are some book titles that are relevant:

* Starting and Running a Non-Profit Made Easy by Entrepreneur Press, David H. Bangs
* Starting and Running a Nonprofit Organization by Joan M. Hummel
* The Nonprofit Handbook: Everything You Need to Know to Start and Run Your Nonprofit Organization by Gary M. Grobman
* Starting & Building A Nonprofit: A Practical Guide by Peri Pakroo

There are plenty of free informational resources out there. Check the source box for links to articles.

Hope that helps! I wish you much success & happiness in all your ventures!