Starting a nonprofit organization takes several steps. The most daunting task usually involves obtaining tax-exempt status from the IRS. Our services include forming the organization and obtaining tax-exempt status from the IRS and the state. Our goal is to provide you peace of mind, as we handle all the steps in obtaining the tax exemptions. We will also handle any questions or concerns from the IRS during the application process. We will also seek tax-exempt status from the state, which in California is obtained from the Franchise Tax Board. Some nonprofit organizations are also required to register with other state entities, such as the Attorney General.
We help clients with other issues related to obtaining tax-exempt status, such as denial or revocation, or obtaining property tax exemption. We can also advise whether a nonprofit organization should be a religious, public benefit corporation, or other type of entity.
We assist nonprofit organizations with a wide range of federal and state compliance issues, including ensuring a nonprofit organization does not engage in an activity that would cause the loss of its tax-exempt status. We have assisted nonprofit organizations in addressing numerous issues, including:
Is the action being taken by the board of directors valid? What form of resolution needs to be included within the corporate minutes? What kind of notice is required to call a meeting?
These are examples of the type of questions that may arise when counseling nonprofit organizations on corporate governance issues. Nonprofit corporate governance can be complicated, especially because many laws and formalities dictate how the corporation and its leadership should act.
We assist with forming nonprofit entities, advising on methods of corporate governance, and drafting documents and policies to further the interests of the organization. It is important for a nonprofit organization to comply with its existing corporate documents because failure to do so could lead to significant liability. Many individuals and organizations only obtain legal assistance when forming a nonprofit organization, but fail to ensure proper corporate governance afterwards. After a nonprofit corporation is formed, it must ensure it complies with its corporate documents, such as its Articles of Incorporation, Bylaws, Conflict of Interest Policy, and other corporate policies. In addition, the nonprofit organization must observe corporate formalities, ensure corporate meetings are properly held, and record meeting minutes.
Moreover, drafting such corporate documents without proper legal counsel can lead to unintended consequences, such as contradictory or inconsistent provisions that lead to major problems, even lawsuits. These documents can affect other areas of operation, such as employment decisions, in addition to corporate governance.
Also, we counsel nonprofit corporations on the roles and duties of directors and officers. Directors and Officers must meet their fiduciary obligations to the organization to ensure they are not exposed to personal liability. We have experience counseling nonprofit organizations in the following areas:
Contracts are common tools used by nonprofit organizations for numerous types of transactions and we can help draft and negotiate such contracts. Whether the purpose is to establish the beginning of a relationship or to settle a dispute between parties, we strive to ensure our client’s best interests are met when drafting such agreements.
For better or worse, nonprofit organizations change. Sometimes it’s because they are growing, and sometimes it’s because they have reached an end. Either way, we can counsel the nonprofit organization and draft the documents necessary to conduct a merger, dissolution, or other corporate change, such as converting from a public benefit to a religious corporation, or vice versa. Nonprofit organizations need to ensure that the law and corporate documents are complied with when making such changes. For example, such transactions often require filing documents with government entities to complete the transaction. We can assist you with this process.
Unfortunately, nonprofits must sometimes deal with disputes, disagreements, and even lawsuits. Rather than diving into a lawsuit right away, sometimes such disputes can be resolved with attorney assistance. We strive to advocate for our clients’ best interests, while entertaining all possible options for resolution. Sometimes disputes can be resolved through reaching an agreement or mediation. Our experience may allow us to help in the following areas: