If you are going to run a charity or non-profit, you need to make sure that you have it set up correctly. For that, you need to make sure that you are set up as a 501(c)(3) entity.
The 501(c)(3) category is something set up by the IRS. It allows an entity to be tax-exempt. Among other things, this allows people who donate to your non-profit or charity to claim their donations as deductions on their taxes.
Setting Up a 501(c)(3)
Setting up one of these organizations isn't as easy as just calling up the IRS and saying that you are a non-profit organization and that you should be tax-exempt. There is a process that you have to go through.
Find a Name
That seems like it would be the easy part; after all a name is a name, right? However, your state likely has rules about what kind of name a non-profit can have. Generally those rules include things like the name can't be the same as any other business entity, it has to have a suffix like LTD. or INC., and it can't include words like bank.
Come Up With a Mission Statement
The mission statement will include what your goals are, the population you are choosing to serve, and the area you are going to be working in. It doesn't have to be long. Two or three sentences should be long enough. You want it to be something easy to understand and very clear. People should know what you are all about immediately.
Hire a Corporate Lawyer
You don't have to wait until you have a mission statement or name before you hire a lawyer. You can bring one in at the very beginning. The lawyer will be able to help you search the name that you want so that you don't accidentally copy one. They can also help you draft your mission statement. Having someone else look at your statement can help make sure that it's coherent and cohesive.
Talk to the IRS
For this part, you are definitely going to want a lawyer. That's because the IRS is going to be putting your new charity or non-profit under a microscope. The form that you have to fill out in order to qualify for the tax-exempt status is dozens of pages long and it will examine a lot of things about your organization. Your lawyer will make sure that all your Is are dotted and Ts crossed. You don't want to give the IRS any mistakes they could use to deny you your 501(c)(3) status.
Helping out other people is a good goal. If that is your goal and you are setting up a charity or non-profit in order to do that, you will want to have 501(c)(3) status. You will have to go through a process to get that. A corporate lawyer who specializes in setting up non-profits, like those at Carter West Law firm, can really help you get through the whole process as quickly as possible.