Follow this instructions to maintain your 501(c)(3) Nonprofit Public Charity in Washington, D.C. in good standing.
9 Steps to Keeping Your Nonprofit Legal
In order to operate a 501(c)(3) nonprofit company in Washington, D.C., you must:
Apply for a tax exemption from the district.
Tax-exempt organisations must file annual federal returns.
Keep a Registered Agent on file.
Submit periodic reports
Pay the Franchise Tax in Washington, D.C.
Request permissions and licences
Register with the Department of Employment Services to renew your charitable registration.
Follow the Public Inspection Rules.
1. Request an exemption from district taxes.
Exemption from district income taxes
After receiving your 501(c) decision letter from the IRS, you may submit for district income, franchise, property, and sales tax exemptions using form FR-164, which can be obtained after login onto the MyTax.DC.gov website. If you need more information, go to the Office of Tax and Revenue’s Exempt Organizations website.
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.If your gross revenues exceed $200,000 or your total assets exceed $500,000, you must file a 990 form.
$200,000 in gross income and $500,000 in total assets —- File 990-EZ
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 incorporated nonprofit must have a registered agent with an office in Washington, D.C. If your registered agent or office address changes, you must submit Form RA-3 with the Department of Consumer and Regulatory Affairs in order for your Articles of Incorporation to be revised.
Your company may be terminated if you fail to inform the Department of Consumer and Regulatory Affairs of this change.
4. Submit Periodic Reports
The Washington, D.C. Department of Consumer and Regulatory Affairs requires nonprofits to file an initial report by April 1st of the year after incorporation. Following the first report, following reports are expected every two years. Your Registered Agent will send you a copy of the annual report to complete, but you may also do it online.
Failure to submit the required reports may result in the termination of your company.
5. Pay the Franchise Tax in Washington, D.C.
Unless your organisation applies for and is granted an exemption, you must pay the Washington D.C. Franchise Tax.
6. Obtain Permits and Licenses
Nonprofits in Washington, D.C. must get a business licence in order to function. You must get either a standard business licence or a charity soliciting licence.
General Business License: If your group will not be collecting charity donations from members of the public, you may apply online with the Department of Consumer and Regulatory Affairs for a general business licence.
Charity Solicitation License: If your group wants to solicit donations from members of the public or seek for grants, you may apply for a charitable solicitation licence online with the Department of Consumer and Regulatory Affairs.
For further information about company licencing, contact the Department of Consumer and Regulatory Affairs:
1100 4th Street, SW, Washington, DC 20024 Phone: (202) 442-4400 Fax: (202) 442-9445 TTY: (202) 123-4567 Email: [email protected]
7. Renew your charity registration.
Charitable Nonprofits in Washington, D.C. that have earned a Charitable Solicitation License must renew the licence every two years. For additional information on the renewal deadline for your organisation, contact the Department of Consumer and Regulatory Affairs.
8. Register with the Department of Employment Services in Washington, D.C.
If your organisation will have workers, you must register with the Washington D.C. Department of Employment Services if you have not previously done so.
Registration is simple and may be performed by completing Form FR-500 on the MyTax.DC.gov website. You may also get in touch with the Washington D.C. Department of Employment Services.
9. 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.
