Financial Forms for Your Non-Profit Organization

Starting a non-profit organization can be stressful. While all you may want to do is help people, you have to make sure you get the financial aspect of it right. There are a few documents you need to make sure you take care of before you get too involved. Otherwise, the government won't know you are non-profit and will tax what it sees as "income." And if you don't file your forms right, people can't donate to you, because it won't be considered a donation, which is stressful for you, but also for someone who thinks they are donating and could later be slapped with a gift tax. Here are few forms you need to make sure you fill out prior to getting your non-profit going.

Article of Incorporation

If you want your donations to be tax-exempt, you have to file an article of incorporation with your state. This means you have to write what your organization is, what it's about, how long it will be in existence, who the directors are, and the incorporator's name. At this time you have to name at least three board members: president, vice president and treasurer. Once this is complete you will get a letter in the mail saying you are tax-exempt, and you can get a bank account for your particular organization.

Form 1023

This is a tax-exempt recognition form that you need to file within 15 months of becoming incorporated. Once this is done, you are considered a tax-exempt 501c(3)organization. People can now make donations to you that they can deduct when tax time comes around, and you do not have to pay taxes on the donations or grants you receive. It is important to note that if you are receiving grants, it is best to keep paperwork saying you successfully wrote and applied for the grant yourself, simply to make it easier should you get audited.

Form 990

This form can be found on the IRS website. (www.irs.gov) . It will contain all pertinent financial information as well as "key employees." These employees can be directors, officers, etc. There are specific instructions on the form as to who is considered a key employee. Keep in mind that the salaries of these individuals will have to go on the form. This information is considered public information, so anyone can see it if they make a formal request. Furthermore, the non-profit must allow anyone to inspect these records at its main office during business hours.