Today we will be covering…

• Brief history of State registration

• Why now?

• State exemptions

• States you do not need to worry about

• What is ‘Charitable Solicitation’ and what triggers registration requirements

• The Charitable Solicitation Act

• States you should consider registering in

• Penalties

• Online solicitation – The Charleston Principles

• How to Register

• Remaining Compliant

• Professional Solicitors/Fundraisers/Counsel

• To register or not to register ? How to decide which state your non-profit

should register in

States in US

Why now?

Why now?

Tax Returns Makes

Nonprofit Fundraising

Registration Unavoidable

Why now?

Tax Returns Makes

Nonprofit Fundraising

Registration Unavoidable

State filing fees good source

of income

28 states grant exemptions to non-profits that have income less than a specified amount

State Exemptions

States you don’t need to worry about

Arizona, Delaware, Idaho, Indiana, Iowa, Montana, Nebraska, South

Dakota, Texas, Vermont & Wyoming

What type of solicitation trigger registration

requirements?

Charitable Solicitation is defined broadly to include any request for a contribution

by a non-profit in which:

An appeal is made for acharitable purpose.

The name of a charitable organisation is used

or a statement is made that implies that all or

part of the donation will be applied to a charitable purpose or donated to a

charitable organisation.

The charitable solicitation act

Where it is worthwhile to register?

California, New York, Florida, Illinois, Pennsylvania, Ohio, Michigan, Georgia, North Carolina and New Jersey.

If you do not register properly in other states before you fundraise, your organization risks penalties and even felony charges.

Penalties.

Online Solicitation -

The Charleston Principles

Under these guidelines, registration in a state is required only if:

- the nonprofit's website is used to make charitable solicitations, and- the nonprofit has sufficient fundraising contacts with state residents, whether through the website or by other means.

Thus, under the Charleston Principles, you do not need to register with a state simply because you have a website that people in the state can view. Something more is needed that means the website becomes ‘Interactive.’

Interactive websiteAn interactive Web site is a Web site that permits a contributor to make a contribution, or purchase a product in connection with a charitable solicitation, by electronically completing the transaction.

General Exclusions Maintaining or operating a Web site that does not contain a solicitation of contributions but merely provides program services via the Internet—does not, by itself, invoke a registration requirement.

Online Solicitation -

The Charleston Principles

Online Solicitation -

The Charleston Principles

Social media and Donor Advised Funds.

A Donate button on a social network would require you to register.

Donor Advised funds like Network for Good and JustGive would have registered in all the states where they are required to register.

Registration involves filing an application with the appropriate state agency and, in most states, paying a registration fee.

Registration usually consists of two parts: an initial registration application and an annual renewal.

Using the Unified Registration Statement (URS)Benefits and disadvantages

How to register…

Documents required for a typical application are:

IRS exemption letter (also known as determination letter)

Form 1023 (Application to IRS for exemption) this gives detailed information about organisations purpose etc.

Certificate of Incorporation from State of domicile

Bylaws

Contact details along with who is responsible for taking custody of donations

Registered in other states

Previous years financial information

How to register…

Annual State Renewals

- In all states annual financial reports are required in hand with registration renewals.

- Audits costs can be between $3,000 to $6,000 whereas accountants reviews can be around $2,000.

- State filing deadlines differ for all the states and extension of time to file renewals and annual reports are permitted in pretty much all states.

Professional fundraisers / Solicitors / Fundraising consultants

In most cases, it is a state requirement when working with any of the above to declare them on your annual financial information such as Annual state reports.

A helping hand

Unless you receive at least $250 in total state

donations each year it makes no sense to

register because ofcost of registration will exceed the value of

donations.

To register or not to register?

Constantly changing rule!

Recap: Things to remember

Register before you start fundraising.

Register in every state where you solicit funds. If you receive less

than $250 in donations from a particular state, don't register.

38 states do accept the Unified Registration Form, but they often differ in

the documentation that they require. You'll need to customize each

registration with the required documents.

In most states that require registration, you also have to renew annually. Each state's

requirements are different and deadlines for renewal vary. Fees for registration differ

state to state.

If you do not register properly in other states before you fundraise, your organization

risks penalties and even felony charges.

This information was not intended to be legal advice. It is advised that you consult your own legal expert in regard to your specific situation.

that’s it!

for listening.