Atlanta Firm Helps Non-profits Get into the Game

They range from churches to private schools to community development groups and indigent care services to research organizations. In fact there is practically no limit to the types of groups that can be legally considered a non-profit organization as long as their activities fit within the framework of being charitable, educational, religious, or scientific in nature, as determined by the Internal Revenue Service. The major challenge facing non-profit organizations is the acquiring of funding needed to carry out their non-profit purpose. In recent years the pool of available funding and grants has increased, both from governmental and private sector sources.

Assisting non-profits to capitalize on the availability of these funds is Job One for Craig R. Dunbar. As non-profit specialist for Position One, a management consulting firm in Atlanta, Georgia, he has shared his expertise to organizations all over the United States to qualify as tax-exempt entities, thereby enabling them to pursue funding opportunities.

One of the impediments to securing funding is the acquisition of federally recognized non-profit status. “This is often referred to as the 5-0-1 status, ” says Dunbar. Section 501 of the Internal Revenue Code is primarily dedicated to the rules and definitions that govern the taxability of organizations that are considered to be non-profit, although other sections of the Code address this issue in part as well.

He cautions that acquiring the federal tax-exempt status does not mean that organizations can suddenly expect a financial windfall. “Acquiring grant funding is competitive. You truly must build a relationship with the funding agencies, but these agencies first have to know that you possess the federal tax exempt status as their giving is typically limited to such organizations.”

To achieve the federal tax-exempt status, organizations must undergo a rigorous application process with the IRS. The process, for which the IRS charges an application fee of as much as $500, can take up to four months. Position One provides this service to organizations around the United States. It has assisted more than a hundred organizations to successfully complete the IRS’ application and evaluation process over the years including churches, childcare programs, private schools, drug rehab programs and community service organizations.

“Our way of doing good is to put these organizations in a position whereby they can do good.” That means successfully completing the federal tax exempt status and qualifying for the funding that can be the difference between merely existing or having a far-reaching, viable non-profit operation.

Dunbar shares the following tips and caveats for would-be federal tax-exempt organizations:

♦ The language of the organization’s articles of incorporation MUST meet acceptable IRS standards in order to achieve tax-exempt status, including specific articles that address organizational purpose, limitations, dissolution, and others.

♦ Certain organizations, such as churches, synagogues, mosques, and other places of worship are considered non-profit businesses under the law by definition. However, when such organizations seek to conduct activities beyond worship services (such as operating schools, daycare centers, homeless shelters, etc) then it is advisable for such religious non-profit organizations to also secure federal tax-exempt status under Section 501 of the Internal Revenue Code. Not doing so can create potentially negative tax implications for the organization.

♦ Non-profit organizations CAN engage in the sale of merchandise as long as revenue from such sales is used towards conducting the organization’s approved non-profit purpose.

C R Dunbar can be reached at Position One from anywhere in the United States toll-free at 1-877-386-3371

Additional Resources/Links: www.position1biz.com/P1nonprft.htm www.irs.gov