To maintain your 501(c)(3) Nonprofit Public Charity in good standing in California, follow this advice.
In order to keep your 501(c)(3) nonprofit company in California, you must:
A. Exemption from State Income Tax
After receiving your 501(c) decision letter from the IRS, you may submit Form 3500A for state income/franchise tax exemptions.
Transaction Privilege Tax B.
The majority of organisations in California will be obliged to pay sales tax. Review this paper issued by the California Department of Tax and Fee Administration to learn more about sales tax and exemptions (CDTFA). If your organisation is eligible for an exemption, you may obtain the necessary paperwork on the CDTFA’s website.
A. Federal Annual Returns
The IRS requires most tax-exempt charitable organisations to submit an annual return (Check the IRS website for a list of exceptions).
An organization’s yearly gross receipts dictate which form should be utilised to submit the annual federal return.
The IRS defines ‘gross receipt’ as “the total sums the organisation received from all sources throughout its yearly accounting period, before deducting any expenditures or expenses.”
If you have any concerns, please contact the IRS at
For example, if the fiscal year closes on December 31st, the form 990 is due on May 15th.
NOTE: If an organisation fails to complete Form 990 for three years in a row, it will lose its tax-exempt status.
B. Unrelated Business Profits
If an organisation earns more than $1,000 from a trade or company that is unrelated to the organization’s declared purpose, it must submit Form 990-T to pay taxes on that revenue.
If your organisation anticipates to pay $500 or more in unrelated business income taxes for the year, you must pay a quarterly estimated tax on the unrelated business income using Form 990-W.
Any organisation that has incorporated must have a registered agent with a California office location. If you change your registered agent or their office address, you must submit a Statement of Information (SI-100) form with the Secretary of State so that your Articles of Incorporation may be changed.
Your company may be terminated if you fail to inform the Secretary of State of this change.
All charities in California must file a Statement of Interest form (SI-100) with the California Secretary of State within 90 days after incorporation. Following the first Statement of Interest form, nonprofits must submit another form every two years, as well as notify the Secretary of State of any changes to their organisation.
Failure to submit the required reports may result in the termination of your company.
Depending on the nature of your organisation, you may need to seek a permission or licence to function lawfully in California. The website of the Governor’s Office of Business and Economic Development may assist you in determining if your company requires any permissions or licences.
If your group will be collecting contributions, there are three things you should bear in mind:
If your organisation will have any form of workers, you must register with the California Employment Development Department.
Registration is simple and may be done online. You may also find your local workforce commission’s contact information online.
To comply with federal requirements governing 501(c)(3) organisations, you must make the following papers available to any member of the public who wants them:
Your company is NOT required to share the following papers or information with the general public:
