Of course, there is more than one type of tax exempt organization. I set up a 501C(4) organization for the fishing club. We are tax exempt, but donations to us are not tax exempt. The C(4) status is relativly easy to get. The type of status depends on your fund raising and use of funds intentions. Don Lutz Virginia Beach ----- Original Message ----- From: Carhart, Lowell <LC111162@exchange.DAYTONOH.NCR.com> To: <NJMONMOU-L@rootsweb.com> Sent: Sunday, March 26, 2000 2:05 AM Subject: [NJMONMOU] Types of Tax Exempt Organizations > Folks, > > It is worth knowing that creating a tax exempt organization is not quick, > cheap, or easy. Forming a legal corporation in NJ *is* very quick and easy, > and has but a modest fee. However, applying for tax exempt status, > submitting the required annual reports, and maintaining the proper ratio of > small and large donors *is* very time-consuming and expensive. For example, > the entity could not maintain its 501(c)(3) tax exemption status with just a > few large private donors. The law requires a somewhat complicated ratio of > small to large donors. This is to prevent rich folks from forming their own > non-profit companies and then funding/running them on their own. By > requiring a broad range of donors, this sort of abuse is curtailed, and also > increases the likelihood that the non-profit will benefit a wider group of > people. There are certain exceptions to the funding rule when the > only/largest donor is a government agency. However, the aim here I believe > is to get private (non-government) funding. If that is the case, then > attempting to form and run a non-profit for the sake of $1,500 would not be > cost-effective. It would cost more than that just to incorporate, pay > set-up fees, and pay for accountants to maintain the paperwork, and > certainly none would go to the project at hand. > > I learned all this from my efforts to form the Topanemus Society which was > *going to be* a non-profit to help restore and maintain the Topanemus > Cemetery. There was no way that I was going to get 100 - 200 folks to donate > ~$20 a year to maintain the correct small donor / large donor ratio, even > though I already had three $500 annual donors lined up. Even having those > three donors and a handful of small donors was not enough to preserve the > 501(c)(3) non-profit status. Also, you don't get the 501(c)(3) status > awarded for several years after applying. The government is not making it > easy to not pay taxes. <wink> > > Kind regards, > Lowell > > > -----Original Message----- > > From: Teddies96@aol.com [SMTP:Teddies96@aol.com] > > Sent: Saturday, March 25, 2000 9:38 PM > > To: NJMONMOU-L@rootsweb.com > > Subject: [NJMONMOU] Check out Types of Tax Exempt Organizations - IRS > > > > <A HREF="http://www.irs.ustreas.gov/prod/bus_info/eo/eo-types.html">Click > > > > here: Types of Tax Exempt Organizations - IRS</A> > > > > Hi. I would think it best to apply for tax exempt status on our own and > > then > > we could take checking into funding further. Here is a link to tell you > > more > > about who is qualified for tax exempt status. > > > > Fayth > >