Reprinted from EO Update
GuideStar Trust Blog, on 1/8/15 8:00 AM
Reprinted from EO Update
The following discussion is provided for informational purposes only and is not intended to serve as legal advice. For advice on how notices related to changes in mission apply to your organization, consult your attorney.
Question: If we alter our mission a bit, what steps do we need to take to update the relevant agencies (e.g., state agencies, IRS, etc.)?
A change to a nonprofit organization's mission likely will require notice to the organization's state of incorporation and the Internal Revenue Service ("IRS").
Most nonprofit organizations are incorporated as nonprofit corporations in a particular state. The document filed with the state in order to obtain corporate status generally is called the articles of incorporation or certificate of incorporation (depending on the nomenclature used in the particular state's law). An organization's mission is very often set forth in its articles of incorporation, and perhaps in its bylaws as well. As the organization's articles of incorporation is a document that is on file with the state, any amendment (even a very minor one) to any portion of the document also needs to be filed with the state. Note that most states set forth certain minimum approval thresholds and processes that organizations must meet in order to formally approve amendments to articles of incorporation.
Once amendments are approved, an articles of amendment (following the form required by the state) should be submitted to the applicable state office. State officials are known to scrutinize closely these filings and will reject them if there is not technical compliance with all legal requirements; as such, it is often advisable that counsel be consulted before undergoing the amendment process.
If the organization's mission statement also is contained in its bylaws, it also will need to amend that document so that it is consistent with the articles of incorporation. An organization's bylaws is generally viewed as an internal set of regulations; revisions to this document generally do not need to be reported to the organization's state of incorporation.
Further, if an organization changes its mission statement, particularly if that change entails amending the articles of incorporation or bylaws, the organization will need to report that change to the Internal Revenue Service as part of its annual Form 990 filing. Specifically, Part VI, Line 4, of the Form asks whether an organization has made any significant changes to its organizing or enabling document or bylaws and, if so, to report that change as part of its Form 990 filing. In the instructions to the Form 990 on this question, it lists examples of changes which should be viewed as "significant." One of the examples is "changes to the organization's exempt purposes or mission."
It should be noted that smaller organizations—those that are only required to submit the Form 990-N postcard filing with the IRS—are not obligated to notify the IRS of amendments to their articles of incorporation or bylaws.
George E. Constantine, Esq., Venable LLP
© 2014, Venable LLP
George Constantine is a partner at Venable LLP in Washington, D.C. He co-chairs Venable's Regulatory Practice Group.
GuideStar Newsletter, on 1/9/14 8:00 AM
Reprinted from EO Update
The following discussion is provided for informational purposes only and is not intended to serve as legal advice. For advice on how state fundraising registration requirements apply to your organization, consult your attorney.
Question: Fundraising in all 50 states via (1) the Internet and (2) mailed solicitations. What do we need to know? Do we need solicitation permits in each state? What are the current laws regarding this type of fundraising?
GuideStar Newsletter, on 9/16/10 8:00 AM
Reprinted from IRS EO Update 2010-20, August 27, 2010, and IRS EO Update 2010-21, September 7, 2010
Suzanne Coffman, on 8/19/10 8:00 AM
The IRS is once again offering its workshops for small and mid-size 501(c)(3)s; invites exempt organizations to attend nationwide tax forums; and has published updates of its publications on (1) documentation and disclosure related to charitable contributions and (2) tax-exempt organizations and gaming.
GuideStar Newsletter, on 5/1/10 8:00 AM
Reprinted from IRS EO Update 2010-8, April 2, 2010, and IRS EO Update 2010-10, April 29, 2010
Suzanne Coffman, on 1/1/10 8:00 AM
The IRS has published tables of the due dates for Form 990 and other returns nonprofits must file, released the governance check sheet that agents will use in exempt organization examinations, and announced the schedule for its spring workshops for 501(c)(3) organizations.
Suzanne Coffman, on 10/1/09 8:00 AM
The IRS Web site has new resources for Form 990 and 990-EZ filers, new nonprofit training materials, and information about the changes in exemption applications fees that will go into effect in 2010.
Suzanne Coffman, on 6/1/09 8:00 AM
The IRS posts another set of tips for filers of the new 990, offers guidance on what to tell the IRS if your organization merges with another nonprofit or ceases operations, and announces events for exempt organizations.