Mother Teresa was one of her kind, and there will hardly be anyone who will disagree with the fact that she was unconditional love and kindness personified. A majority of people cannot do so much or even a minuscule of what she has done. To give unconditional compassion and love, you need to have a real big heart and determination to uplift the underprivileged.
For some of us who want to do something for others, may be starting up a 501(c)(3) organization is a good idea. The best part about this social work is that it is normally exempt from income tax and property taxes. Moreover, it can receive tax-deductible donations from companies and individuals, as well.
A 501(c) organization refers to an American tax-exempt nonprofit association or corporation. According to Section 501(c) of the United States' Internal Revenue Code (IRC), 29 types of nonprofit organizations are exempt from income taxes collected under the federal law. The 501(c)(3) comes under this, and it is one of the most common ones amongst all that are exempt from tax. An organization or association is a 501(c)(3) if it falls under these categories: religious, charitable, scientific, public safety, literary, educational, national/international amateur sports, and prevention of cruelty to children or animal. The structure could be anything from a corporation to fund, to a foundation or even a community chest.
Starting This Organization
If there is an issue that is very dear to your heart and if you want to do something about it to help others, it would be great. However, for this, you would need to have a clear-cut and well-defined mission statement. It should reflect the values and goals of your organization. Along with this, it should also mention what it will do and for whom. This is important because if the statement is not clear and convincing, there are less chances that you will get good donations.
Getting some people to join you in your noble cause is the next step for establishing a 501(c)(3) association. The condition is that minimum three people should be ready to support the mission of the organization. These will be the members of the board of directors of your charity or the likes you have in mind. However, these people should willingly give their time and efforts for the organization and its objectives. Once that is done, you need to chalk out the rules and by-laws about its operation.
After the laws and by-laws have been drafted, the fiscal issues have to be taken care of. Here, the issue of budget comes to the fore. The budget ideally should be as detailed and clear as it can be made. Start up costs and long-term and monthly expenses are a must. Accounting system has to be set up with the help of a financial consultant. This is essential to keep your organization accountable to the government and public. Simultaneously, record keeping system has to be in place; more so, in case of donations. The records should be up-to-date, and it is imperative to be very careful and meticulous about them.
This initial and primary setup - the articles of incorporation with your state - that is telling your state that a nonprofit organization is being established by you has to be done. Your state's attorney general or secretary office will help you to get the necessary paperwork done. A nominal fee might be required in some cases. The next step is to file for 501(c)(3) status with the Internal Revenue Service (IRS). The form is required to be filled up as specified by the IRS, accompanied by a fee depending on your budget.
The last thing you need to do is to apply for and get a federal employer identification number (EIN). This is a must if you want to start any nonprofit organization. The number is imperative because then it can identify you as a tax exempt organization when you are filing tax documents.
This is a general idea about the whole concept and starting one. Although this process seems to be tedious and complicated, it is advisable that you research about the same on the IRS website to ease things up with it.