Forming A Nonprofit Business Entity
There are many good reasons to organize your business as a nonprofit.
Nonprofit businesses, or 501(c) 3 companies, are exempt from taxation at the corporate level and are often entitled to certain state tax exemptions as well.
Organizing your business as a nonprofit can open up a whole world of grants and donations. Many public grants are earmarked for 501(c) 3 entities. Several major private foundations give donations only to nonprofit businesses. Individuals can give tax-free contributions to properly organized and federally recognized nonprofits.
There are several other potential benefits to being a nonprofit, including exemption from certain local and real property taxes, positive public perception, cheaper postal and advertising rates, and many others.
The question of whether a nonprofit is the right business entity for your company is a complicated and important one. Your company must consider all of the potential pros and cons, and if you’ve never done it before, you should consult with an experienced professional on whether it is the right choice for your company and how best to accomplish nonprofit status if you go that direction.
Electing to go nonprofit is not without its downsides. The most significant limitation, and one with ramifications throughout the life of your company, is the most fundamental one. There is no private ownership of a nonprofit. This means no distributions and serious restrictions on end-of-life options for your company (the company must roll its assets into another nonprofit).
The formation requirements of starting a nonprofit business can be daunting, and the annual reporting requirements can be confusing. That’s what we’re here for. The team of nonprofit formation attorneys at Slinde Nelson has experience navigating both the formation and regulatory landscape for 501(c) 3 corporations.
What Do You Need Assistance With?
Our 501(c) 3 formation attorneys can help you with every aspect of 501(c)(3) formation and maintenance, including:
- Analyzing the pros and cons of forming as a nonprofit or going through a conversion to a nonprofit
- Preparing and filing the articles of incorporation
- Amending and restating the articles of incorporation
- Preparing the nonprofit’s bylaws
- Preparing the nonprofit’s initial director minutes
- Preparing the company conflict of interest policy
- Obtaining the company EIN
- Registration with the Oregon Department of Justice’s charitable activities section
- Obtaining local business permits
- Risk management and insurance procurement
- Preparing the application for tax-exempt status (Form 1023)
- Registering and filing annual reports with the Oregon Department of Justice
Slinde Nelson works with all types of nonprofit organizations from public charities to private foundations, clubs, churches and para-church ministries, and many, many more. If your company has made the decision to go nonprofit, you should contact a team of well-qualified nonprofit transactional attorneys in Portland to help you through the process.