Eligible for state and federal exemptions from payment of corporate income taxes, as well as other tax exemptions and benefits.
Eligible to receive both public and private grants.
Directors, trustees, officers, employees and members are not personally liable for corporate debts or liabilities.
A nonprofit corporation is a legal entity separate from the people who manage and work for it, or participate in its activities-a legal “person,” capable of entering into contracts, incurring debts, receiving and maintaining funds, and, generally, doing anything a real person can do.
Exists as a legal entity despite changes in management or other corporate personnel caused by the resignation, removal or death of the people associated with it.
The principals can also be employees and, therefore, be eligible for employee fringe benefits.
The formation documents show clear-cut delegation of authority and specific operating rules to run the organization providing procedures for decision-making and dispute resolution.
Lower postal rates, cheaper advertising rates, free radio/television public service announcements, lower membership rates offered by the “big box” stores.
Requirements regarding the organizational paperwork including additional fees, compliance with the day-to-day operational rules and, required periodic filings with state and federal agencies.
Scrutiny by the public, the donors supporting the cause, governmental agencies and the fund-raising community have demanded cost efficiency (percent of budget used for fund raising) to determine the effectiveness of a nonprofit organization and also as an indicator of fraud.
Must file IRS Form 990 (or Form 990-EZ), annual Return of Organization Exempt From Income Tax.
State Nonprofit Corporation Tax Returns and Reports are also required.
Federal and state employment (payroll) taxes must be withheld and paid on behalf of the employees.
Corporate staff and other compensated corporate personnel must report and pay taxes on employment compensation on their individual income tax returns.
Sales, Use, Excise and other state taxes may apply (some exemptions may be available).