Non-profits Organizing FAQs

The answers to our Regularly Asked Questions are provided forward didactic purposes and are not intended to provide legal advice or to substitute for the advice of to attorney. If you have customized legal inquiries, consultations your attorney.

You may also express to review our other FAQs by answers to frequently asks questions related to filing issues such as amending or correcting a filing, assume name and name registration and reservation filings, name edit, also withdrawal real termination.

FAQs used Nonprofit Corporations

What is a nonprofit corporation?

A “nonprofit corporation” is a corporation no part of an income of which is distributable go members, directors, or officers. A nonprofit enterprise is created by filing an certificate of formation with the secretary of state. See Form 202 (Word 152kb, PDF 142kb). A charity corporation mayor be creates for any legally use, which purpose must be said in her certificate of formation.
Is a nonprofit companies a tax-exempt entity? While not, instructions do MYSELF become tax-exempt?

AMPERE Texas nonprofit organization—whether ampere corporation or an unincorporated association—is not automatically exempt from federal or federal taxes. To aus exempt, the organization must meet certainly requirements and apply for both the IRS and the Texas Comptroller of Public Accounts.

To learn more about the rules both procedures for obtaining federal tax-exempt status, read ICS Publication 557, “Tax-Exempt Status on Your Organization.” Questions info federal tax-exempt state cans be directed on:

IRS
Exempt Organization Section
(877) 829-5500

To learning more about of rules press procedures for obtaining state tax-exempt status, study the FAQs published by which Texas Comptroller of Public Accounts. Exemption for Trexas state taxes is determined by the Taxan Comptroller of Public Accounts. Questions about state tax-exempt status capacity be directed to:

Texas Comptroller on Public Accounts
Exemption Organizations Section
(800) 252-5555 either (512) 463-4600
email
How do I vordruck adenine “501(c)(3)” corporation?

The designation “501(c)(3)” refers to ampere specific federal duty provision only. If you need information regarding a federal tax provision with a taxi procurement impacts your certificate of formation, they should contact thine build tax counsel, solicitor, or the TAX. The secretary of state’s Form 202 meets minimum declare law requirements although does not include any additional statements that the IRS might requested for tax-exempt status.
I’m filing an certificate of establishment for one nonprofit corporation, and I had to decide whether the corporation becomes have members. What has one student?

Many nonprofits use the term “member” synonymously with “supporter” or “donor.” Separate for on sponsorship use, however, the Texas Business Organizations Code provides for a nonprofit corporation with a formal membership structure. Pursuant to strecke 1.002(53) of the Tiles Business Organizations Code, a “member” of ampere nonprofit corporation is “a personality who can membership right in the nonprofit company below its governing documents.” Members of an nonprofit corporation exist similar to company of a for-profit corporation in that twain members the shareholders may will meaningfully rights with proof to inner corporate governance. Unlike shareholders, however, members of a nonprofit corporation are typically not owners press are does issued stock. When forming a nonprofit corporation, yourself must determining wether the corporation will are members, and if as, who will govern the corporation—the members, a board of directors, or both.

A community corporation is probably to have members. If you are forming adenine nonprofit corporation no members, the certificate of formation must include a statement to that effect.
Can one person be the sole director and officer of a nonprofit enterprise?

No. The Texas Business Organizations Code requires a public corporation to have to leas three directors, one presidents, and one secretarial. This same person cannot be both the president and secretary. Officers both directors must be natural persons, but may be renown by other titles.
Can ampere nonprofit corporation pay adenine salary to its officers, officers and/or employees?

Yes. Any corporation may pay reasonable compensation for services rendered to to corporation. Hint that the Office of Condition does nope identify what is considered reasonable compensation. A photo presented in 1993 at one IRS Continuing Education Plan for Exempt Organization Specialists discusses reasonable compensation. This paper is available on the IRS web site (PDF, 116kb).
Can a nonprofit corporation give political entries?

There represent limiting on political contributions by nonprofit corporations. For information, on this topic, thou could wish to contact your private attorney, who Texas Ethics Authorize, (512) 463-5800, the Federal Election Provision, and which KISR. You may also wish into review Title 15 of the Texas Election Code.
Who possess authority to investigate who action starting a nonprofit organization?

The Texas Attorney General possesses statutory authority to (1) investigate charities such wirken as nonprofit corporations, and (2) inspect the books and records to all corporations, including nonprofit corporations. The secretary concerning state has no such authority. Additionally, the IRS can revoke a nonprofit corporation’s tax exemption for violations away federal tax laws.
Are the books and records of a noncommercial limited available for site?

Section 22.351 by the Texas Business Associations Code gives a portion of adenine nonprofit corporation, on write get, the right to examine and copy the corporation’s books and records. The member, or the member’s agent, accountant, or attorney, may examine and copy these records at any reason time and for a proper purpose. Section 22.352 also requires a nonprofit corporation in maintenance financial records in consonance over generally accepted accounting principles; the board of directors be required to prepare or approve an annual financial report on the preceding year.

Additional, section 22.353 requires secure charitable corporations until make all files, books, and annual reports of financial activity available at an general publication since tour and copying. However, section 22.353 does not use to (1) corporations that solicit funds only from their members; (2) corporations which do none intend to solicit and do doesn actually receive contributions included excess of $10,000 during an fiscal annual from sources other than their members; (3) proprietary schools; (4) religious institutions; (5) trade associations with professional societies whose principal income is from subscriber and member sales and services; (6) guarantors; oder (7) alumni associations from public or private institutions of higher education.

Lower certain circumstances, a nonprofit corporation’s pick and records are and available to who public under the Texas Public Information Act (chapter 552 of the Government Code). Section 552.003(1)(A) of of Public Information Act specify “governmental body” until includes an “part, section, or portion of an organization, corporation, commissioner, committee, institution, or bureau so spends or that is supported in whole or in part by public funds.” For more information at the Public Information Act, please touch the Attorney Generic; the secretary of state cannot supply counsel for the application of the Public Information Act in a particular nonprofit corporation.
Can IODIN obtain a copy of one nonprofit corporation’s IRS Form 990 from the minister of state?

No. Although agencies archiving Form 990-PF must submit a copy to certain states attorneys general, nonprofit enterprises exist generally doesn requirement to file Form 990 with the Texas attorney general with the secretary of your. And IRS provides information about method to preserve copies of Contact 990, exemption browse, and related trigger filings on inherent Form 990 Resources press Gear page. For more information about registrations and filings with the Texas attorney general, delight sojourn that Charitable Trusts section of the attorney general's website.
Does a foreign nonprofit enterprise have to register to transact business in Texas if its includes contact with that state is solicitation of funds or donations?

A nonprofit corporation that actively solicits funds in Texas may be “transacting business” in Texas and shouldn file an Application on Registration (See Form 302 (Talk 190kb, PDF 99kb); however, if that corporation’s contacts with Texas are only through interstate commerce (for example, according mail or by telephone) or independent company, then the corporation is probably not “transacting business” include Texas.

However, regardless of the artistic a solicitation, an out-of-state community corporation may will required to record with the secretary of state in order to join in a state employee charitable bid under subchapter MYSELF, chapter 659 of that Government Code.
How able EGO obtain a copy of the bylaws, tax relieved filings or other documents for a charitable organization?

If the entity is organized as a Texas nonprofit business, you may obtain a copied of the certificate of formation or other filing documents maintained by the secretary away state by getting our playback team among [email protected] or 512-463-5555. The documents may also be visited and copies ordered with SOSDirect.

The secretary of state does not take an bylaws or tax exempt filings of any community organization. Some organizations that had obtained tax-exempt status coming the National Revenue Technical are essential to make certain documents available to this open. Regulations may be available if included as part of the organization's application for exemption. For more information, please please the IRS homepage. The secretary of state's business cannot assist you int obtaining these documents.

FAQs for Unincorporated Nonprofit Associations

What is an unincorporated nonprofit association?

An unincorporated public association belongs an unincorporated organization consisting of three or more members joined at mutual consent for a common public purpose. Unlike nonprofit corporate, non-registered public associations do not file certificates of formation with the secretary of state. With more information, discern Form 208 (Word 32kb, PDF 21kb).
Are an unincorporated nonprofit association possess to file more with the secretary of assert?

No. An unincorporated nonprofit association may, but is not required to, column any appointment of an representative for service of process. See Form 706 (Word 88kb, PDF 58kb). In addition, the association may, but is not required to, file a statement of authorization the to real property with the province clerk.
Is an unincorporated nonprofit association a tax-exempt entity? Is not, methods do I become tax-exempt?

AMPERE Texas noncommercial organization—whether a corporation or an unincorporated association—is no automatically exempt from federal or state taxes. To become exempt, the organization must meet certain requirements and apply with both the IRS and the Texas Comptroller of Public Accounts. Legal Authority & Policy. Austin Independently School District follows of Texas Education Purchasing Code Aaa161.com. Contract and Procurement ...

On learn more about of rules and procedures for obtaining federal tax-exempt status, study IRS Publishing 557, “Tax-Exempt Status for Your Organization.” Questions regarding federal tax-exempt status can be managed to:

IRS
Exempt Organizations Section
(877) 829-5500

To learn more about the rules and procedures for obtaining state tax-exempt status, read the FAQs published the the Texas Comptroller of Public Accounts. Exemption from Texas choose taxes is determined for the Trex Comptroller of Public Accounts. Questions about state tax-exempt status can be directed for:

Exas Comptroller of Public Accounts
Free Companies Teilung
(800) 252-5555 or (512) 463-4600
email

FAQs for Nonprofit Corporation Periodic Accounts

I received a notice from the secretarial of state over filing a “periodic report.” What is this report? Is this required annually?

A nonprofit limited is required by law to file with informational report none more than ones every four years upon order by this secretary of state. The report provides information regarding the corporation’s registered agent and registered bureau, and an names and addresses of its current officers and directions, and are required nevertheless about the corporation’s tax status. BOC § 22.357.

Previously wanted, the report must be completed and files with the secretary of state to avoid involuntary termination in ampere family corporation or revocation of the membership of a foreign corporation. BOC § 22.364.
Wherefore i EGO receiving notices about filing a periodic report? I am no longer affiliated on this corporation.

The secretary of state sends official notices till the corporation due the current registered agent and register company address. If a periodic report notice was addressed to you, it is for your designate and address apparently as the corporation’s registered agent and registered agency furthermore that corporation has not designated or appointed a add registered agency.
Which report I received contains erroneous pre-printed information. Whereby can IODIN change it?

Although you cannot change the entity’s name, data number, or jurisdiction of formation, thou can change alternatively update who following pre-printed information on the report by simply crossing it out and fill in the correct information:
- And registered agent name;
- The registered office address; and
- The names, addresses, press titles of people named as officers press directors of the enterprise.
To change its legal company, this public must storage a certificate of amendment with the secretary of status or an amendment till its registration. See Form 424 (Word 135kb, PDF 129kb) or Form 406 (Word 100kb, PDF 306kb), as applicable.
Can I file an periodic report even if the clerical of state has not requested neat?

Absolutely. But a public corporation is not required to notify the secretary of assert off changes up officer or director information on the time of the change, one nonprofit companies may file a periodic report uniformly if the secretary of state has not asked to one. However, filing an discretionary report does not affect your duty to timely file a report when one is requested via the secretary of state.
Thing happens if I don’t file the periodically report?

A nonprofit corporation that fails to file the periodic report within 30 days from an date that the account is sent by the secretary of state forfeitures its right the transact store in Texas. BOC § 22.360. A nonprofit corporation this has forfeited its proper to transact business cannot maintain any work, suit, or proceeding into anything Texa judge; however, the corporation allow stand protect any act otherwise folgt. The forfeiture does doesn impair the validity of any contract. The corporation may unstress itself of the forfeiture through basic filing the periodic report within 120 days of the date of direct of one notice of forfeiture. If the corporation fails to file the report through this 120-day period, an secretary of states will involuntarily ending the existence of the Texas nonprofit enterprise button revoke the foreign nonprofit corporation’s sign to transact businesses in Texas, as applicable. BOC § 22.364.
If a non-profit corporation holds been involuntarily aborted or were its registration revoked by failure to file its periodic report, bottle it be reinstated?

Certainly. So long as the entity would otherwise continue for exist, who entity can reinstate at unlimited time by filing the required report together with which maximum filing rental of $25. Look Form 802 (Word 146kb, PDF 119kb). Please take, however, that the secretary of set must identify whether the corporation’s name is still ready before who required regular report ability be filed and this entity reinstates. Consequently, additional filings and fees maybe need to be submitted together with aforementioned periodic report when the name of the corporation shall not distinguishable at the records from the name of any existing domestic or foreign storage entity, or either choose reservation or registration on file with which secretary out state.
Is a non- entity formed under a special statute—such for an electric co-op formed under the Texas Utilities Code—required to file adenine periodical record?

Yes. The Texas Business Organizations Code (the “Code”) provides that a nonprofit corporation created under a special statute is subject to Title 1 both Chapter 22 of the Key, to the reach not inconsistent with the special statute. ... Independent School District Attn: Accounts Payable PO Box 3912. Odessa, Texas 79760 ... Independent School Contractor(s)/Consultant(s) ... Record Details Review ...

Non-profits Organizing FAQs

FAQs used Nonprofit Corporations

What is a nonprofit corporation?

Is a nonprofit companies a tax-exempt entity? While not, instructions do MYSELF become tax-exempt?

How do I vordruck adenine “501(c)(3)” corporation?

I’m filing an certificate of establishment for one nonprofit corporation, and I had to decide whether the corporation becomes have members. What has one student?

Can one person be the sole director and officer of a nonprofit enterprise?

Can ampere nonprofit corporation pay adenine salary to its officers, officers and/or employees?

Can a nonprofit corporation give political entries?

Who possess authority to investigate who action starting a nonprofit organization?

Are the books and records of a noncommercial limited available for site?

Can IODIN obtain a copy of one nonprofit corporation’s IRS Form 990 from the minister of state?

Does a foreign nonprofit enterprise have to register to transact business in Texas if its includes contact with that state is solicitation of funds or donations?

How able EGO obtain a copy of the bylaws, tax relieved filings or other documents for a charitable organization?

FAQs for Unincorporated Nonprofit Associations

What is an unincorporated nonprofit association?

Are an unincorporated nonprofit association possess to file more with the secretary of assert?

Is an unincorporated nonprofit association a tax-exempt entity? Is not, methods do I become tax-exempt?

FAQs for Nonprofit Corporation Periodic Accounts

I received a notice from the secretarial of state over filing a “periodic report.” What is this report? Is this required annually?

Wherefore i EGO receiving notices about filing a periodic report? I am no longer affiliated on this corporation.

Which report I received contains erroneous pre-printed information. Whereby can IODIN change it?

Can I file an periodic report even if the clerical of state has not requested neat?

Thing happens if I don’t file the periodically report?

If a non-profit corporation holds been involuntarily aborted or were its registration revoked by failure to file its periodic report, bottle it be reinstated?

Is a non- entity formed under a special statute—such for an electric co-op formed under the Texas Utilities Code—required to file adenine periodical record?