Follow this advice to maintain your Vermont 501(c)(3) Nonprofit Public Charity in good standing.
In order to keep a 501(c)(3) nonprofit company in Vermont, you must:
A. Exemption from state income taxes
Once you obtain your 501(c) decision letter from the IRS, your organisation will be immediately exempt from Vermont corporate income taxes.
B. Exemption from state sales tax
Nonprofits in Vermont may petition for a sales tax exemption by submitting Form BR-400, Application for a Business Tax Account, accompanied with a copy of their Articles of Incorporation. This form may be filled out online or by mail.
Visit the Vermont Department of Taxes’ website to learn more about sales tax exemptions.
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 charity that has incorporated must have a registered agent with a Vermont office location. If you change your registered agent or their office address, you must submit a Change of Registered Agent 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.
The Vermont Secretary of State requires nonprofits to file an initial report between January and April of the calendar year after the formation of the charity. You will be expected to submit reports every two years after the first report. You may submit your report online at the Secretary of State’s website.
Failure to submit the required reports may result in the termination of your company.
Nonprofits are not eligible for state-level business licences in Vermont. Check with your local clerk to see if there are any city/county regulations you must follow.
Nonprofits in Vermont that want to collect donations are usually excluded from registering as a charity organisation. If your group intends to hold a paid fundraiser, you must submit a solicitation notice with the Vermont Attorney General’s office.
The Attorney General has issued Charitable Nonprofit Board Guidance, which may be relevant to all charitable charities.
If your organisation will employ people, you must register with the Vermont Department of Labor.
Registration is simple and may be done online. The Department of Labor’s contact information is also available on their website.
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: