Follow this advice to maintain your Connecticut 501(c)(3) Nonprofit Public Charity in good standing.
8 Ways to Keep Your Nonprofit Legal
In Connecticut, a 501(c)(3) nonprofit company must be maintained.
Apply for a state tax exemption.
Tax-exempt organisations must file annual federal returns.
Keep a Registered Agent on file.
Submit periodic reports
Request permissions and licences
Register/Renew Your Charitable Organization
Become a member of the Connecticut Department of Labor.
Follow the Public Inspection Rules.
1. Apply for a state tax exemption.
A. Exemption from state income taxes
Once your organisation has received its 501(c) decision letter from the IRS, you may use form REG-1 to apply for state income tax exemptions as well as your state Tax ID number. Your organisation will be immediately excluded from state-level income tax if you submit your decision letter together with form REG-1.
Revenue Services Department
PO Box 2937
Hartford, Connecticut 06104-2937
Phone: (860) 297-5962
Website: http://www.ct.gov/DRS/
There is no filing fee.
B. Exemption from state sales tax
Nonprofit companies in Connecticut are also free from state sales tax if they meet these rules and present vendors with a CERT-119.
Visit the Connecticut Department of Revenue website to learn more about state-level taxes and how they relate to organisations.
2. Tax-exempt Organizations’ Annual Federal Returns
A) Federal Annual Returns
The IRS requires most tax-exempt charitable organisations to submit an annual return (Click here 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.”
For gross revenues of $50,000 or more, file Form 990-N.
$200,000 in gross income and $500,000 in total assets —- File 990-EZ
If your gross revenues exceed $200,000 or your total assets exceed $50,000, you must file a 990 form.
If you have any questions, please contact the IRS at:
(800) 829-3676 (Form related questions)
(800) 829-1040 (general information)
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.
3. Keep a Registered Agent on file.
Any charity that has formed must have a registered agent, also known as a statutory agent, with a Connecticut office address. If you change your registered agent or their office address, you must submit Form AC-1-1.0 with the Secretary of State so that your Certificate of Incorporation may be revised. This form is also available online through the Secretary of State’s online filing system.
Your company may be terminated if you fail to inform the Secretary of State of this change.
4. Submit Periodic Reports
Each year, the Connecticut Secretary of State requires nonprofits to file an annual report, which is due on the anniversary date of your organization’s founding. The Secretary of State’s Business Services Division Online Filing System may be used to complete this report online.
Failure to submit the required reports may result in the termination of your company.
5. Request Permits and Licenses
Depending on the nature of your organisation, you may need to seek a licence or a business permit in Connecticut.
To find out whether you need to register, use the Connecticut Economic Resource Center’s New Business Checklist and the Advance CT License Search.
If you have any questions concerning licence requirements, please call the Advance CT at 1 (860) 571-7136.
6. Register/Renew Your Charitable Organization
Charitable Connecticut NGOs who want to collect donations must register with the Department of Consumer Protection through their website. Furthermore, if your group intends to offer charity games (bingo, raffles, etc.), it must adhere to the Department of Consumer Protection’s requirements. Check out this page on their website to get those guidelines.
7. Become a member of the Connecticut Department of Labor.
If your organisation intends to hire people, you must register with the Connecticut Department of Labor.
Registration is simple and may be done online. On this page of the Connecticut Department of Labor website, you may also find contact information for your local workforce commission.
8. Follow the Public Inspection Rules.
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:
Annual returns for your organisation may be filed up to three years after the due date (including the following Forms: 990-PF, 990-EZ, 990-T, and 990)
Any supporting documentation and attachments for the 990 forms listed above. For Schedule B, however, you simply need to indicate the kind of the gift and the amount given.
Official IRS documentation demonstrating that your group is tax-exempt.
Your organization’s exemption application and any supporting documentation filed with it (including Form 1023).
Your company is NOT required to share the following papers or information with the general public:
Any part of Schedule B of Form 990/990-EZ that names donors.
Anything deemed an adverse judgement, including past rejections of tax-exempt status.
Any extra information that the IRS is entitled to withhold, such as trade secrets, patents, and so forth.