When forming a corporation, you may have many options available.
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Not-for-profits are companies designed to help the greater good of the community or to support a cause. Not-for-profits operate in a similar manner to corporations, but these companies enjoy additional tax benefits. To qualify for not for profit status, you must use your company’s profits to support your cause, rather than distribute the earnings to shareholders, directors, or other participants in your organization. However, you are permitted to pay workers for services they render to the not-for-profit. This means that if you work as your not-for-profit’s CEO, you are permitted to pay yourself a salary commensurate with earnings other professionals with a similar standing would receive. Not-for-profits can better serve their missions because donors are able to claim tax exemptions for donations they make to the organizations. Because not-for-profits enjoy tax-exempt status, they are subject to strict requirements. If you are not sure about whether your organization should form itself as a not-for-profit, contact Legal Counsel, P.A. and consult with our not-for-profit formation lawyer in Orlando, Florida. Have questions? We have answers. Contact Legal Counsel, P.A. today at 407-982-4321.
The main difference between a not-for-profit and a corporation involves how profits are used. Any money your company makes after operating expenses is considered profit. In a corporation, profits generally go to shareowners and owners of the company. With a not-for-profit, profits go to the stated cause of the organization—usually to benefit a church, community organization, social cause, or school. Profits are taxed differently for not-for-profit corporations. Because the profits of not-for-profits go back to the community, these organization’s profits are not taxed.
Not-for-profits also enjoy the similar benefits and responsibilities that for-profit corporations enjoy. Not-for-profits must have articles of incorporation and they must have a board of directors. Members, directors, and officers enjoy limited liability and their assets are protected from creditors should the not-for-profit run into financial difficulty.
If you are going to start a not-for-profit, you’ll want to clearly outline which causes and community work your company benefits. Our not-for-profit lawyer at Legal Counsel, P.A. in Orlando, Florida can write Articles of Incorporation, Bylaws, rules governing the election of your Board of Directors, guide you with the process of filing with state entities, and obtaining your 501(c) status.
If you are considering starting a not-for-profit to further a cause you believe in, consider reaching out to Legal Counsel, P.A. in Orlando, Florida and consult with our not-for-profit lawyer to assist you. Have questions? We have answers. Contact Legal Counsel, P.A. today at 407-982-4321.
To create a not-for-profit in Orlando, Florida, you’ll need to take several important legal steps. The first step is to create articles of incorporation. You’ll also need to apply for 501(c) tax exempt status with the IRS. There are many different types of 501(c) types, depending on the type of not-for-profit you plan to run. It is important to select the right type of IRS designation. According to the IRS, tax-exempt organizations include charitable organizations, social welfare organizations, agricultural or horticultural organizations, labor organizations, trade associations, social clubs, fraternal societies, employee benefit associations, veterans associations, political associations, and other types of tax exempt associations. In addition to registering your business as a 501(c), you’ll also need to select and register your not-for-profit. You’ll need to select a unique name and ensure that the name is not already in use by another company or organization. While not-for-profits may not have shareholders, they may have boards of directors to oversee their missions and goals.
So, to summarize, to form a not-for-profit, you must take certain important steps. According to USA.gov, these including choosing a business name, appointing a board of directors, deciding on a legal structure, filing incorporation paperwork, applying for tax-exempt status, and obtaining any necessary permits. If you have questions about any of these steps, the IRS and governmental organizations may be able to assist you. However, if you are not sure whether a not-for-profit structure is right for you, consider speaking to the qualified not-for-profit lawyer at Legal Counsel, P.A. today.
Choosing to organize your mission-based company as a not-for-profit can have benefits. However, the process can be complex. It is often wise to consider speaking to the qualified not-for-profit lawyer at Legal Counsel, P.A. in Orlando, Florida. Visit our firm today and grow your mission-based work. Have questions? We have answers. Contact Legal Counsel, P.A. today at 407-982-4321.