Follow this advice to maintain your South Dakota 501(c)(3) Nonprofit Public Charity in good standing.
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7 Ways to Keep Your Nonprofit Legal
In order to keep your 501(c)(3) nonprofit company in South Dakota, you must:
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
Employees
Follow the Public Inspection Rules.
1. Apply for a state tax exemption.
A. Exemption from state income taxes
South Dakota has no corporate income tax.
B. Exemption from state sales tax
Access the SD Department of Revenue’s Sales Tax Guide and the Exempt Entities document to see whether your organisation qualifies for a tax exemption. If you are qualified, you may apply for a sales tax exemption online by completing the exemption request form.
2. Tax-exempt Organizations’ Annual Federal Returns
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.”
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 $500,000, you must file a 990 form.
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.
Any organisation that has formed must have a registered agent with a South Dakota office location. If your registered agent or office address changes, you must submit a Statement of Change with the Secretary of State (online | mail) so that your Articles of Incorporation may be revised.
Your company may be terminated if you fail to inform the Secretary of State of this change.
4. Submit Periodic Reports
Nonprofits in South Dakota are required to file an annual report each year, which is due on the first day of the organization’s anniversary month. Annual Reports may be submitted online or by mail.
Failure to submit the required reports may result in the termination of your company.
5. Obtain Permits and Licenses
Nonprofits in South Dakota are not needed to get a state licence or licence. However, you should check with your city/county clerk to see if there are any local criteria for NGOs.
If your group intends to hold charity games (bingo, raffles, etc.), it must fulfil the Consumer Protection division’s guidelines.
6. Workers
If your organisation will employ people, you must register with the South Dakota Department of Labor and Regulation.
Registration is simple and may be done online. On their website, you can also find contact information for the Department of Labor and Regulation.
7. Obey 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.