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Activate My 501c3

Corporate Law Discussions

Activate My 501c3

Postby Gerald » Mon Jul 11, 2016 12:54 pm

I had a sole propertiship, which I transition too a 501c3 corporation.  I want to reactivate and move it to Maryland.  It is The Anthony R. Wortham, School for the Performing Arts, Inc.  I am also applying for at curatorship at the Grove Farm properties Historical plantation in earleville MD, Can I receive donations and grant funds while i am doing the transition?
Gerald
 
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Activate My 501c3

Postby Hezron » Tue Jul 12, 2016 10:44 am

It is not clear from what you wrote whether you have already incorporated in the State of Maryland as a nonprofit corporation.  If you have, then you can then become active and receive donations and grant funds after you obtain an EIN(Employer Identification Number - or Taxpayer Id number) for the corporation and open the corporate bank account.

The organization must have certain IRS-mandated clauses

in the organizational document even if your organization

is not required to apply for federal exemption but if you

want the benefits of being an exempt organization.

See, starting in the middle column of page 26 of

Publication 557  under "Organizational Test". Samples

start on page 77 and the IRS discusses some of the

textual requirements for the organizational document

starting in the middle of page 26 of their Publication

557 and going through the paragraphs under the heading

"Dedication and Distribution of Assets" on page 27.http://www.irs.gov/pub/irs-pdf/p557.pdf The IRS may take months to issue the exemption determination

letter, but as long as you file your exemption application within

27 months and are approved for exemption status by the IRS you may

begin full operations upon state incorporation.

See IRS Publication 557 "Tax Exempt Status for Your Organization"http:// www.irs.gov/pub/irs-pdf/p557.pdf

which has on page 23, middle column, under the heading "Effective

date of exemption" that the exemption determination is granted

retroactively to the date of formation which is normal for

501(c)(3) organizations that apply for exemption within the first

27 months of their formation. "If the organization files the

application within this 27 -month period, the organization's

exemption will be recognized retroactively to the date it was

organized." Harvey Mechanic

Attorney at Law [email protected]

P.S. This response is intended to be a general statement of law, should not be relied upon as legal advice and does not create an attorney/client relationship.
Hezron
 
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Joined: Tue Jan 21, 2014 11:25 am


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