To maintain your 501(c)(3) Nonprofit Public Charity in good standing in Iowa, follow this advice.
7 Ways to Keep Your Nonprofit Legal
In order to keep a 501(c)(3) nonprofit company in Iowa, 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
Your organisation will be immediately exempt from corporation income taxes after you obtain your 501(c) decision letter from the IRS.
B. Exemption from state sales tax
Most Iowa organisations will be unable to secure greater tax breaks. On the Iowa Department of Revenue’s website, you may learn all you need to know about taxes and exemptions for NGOs.
2. Tax-exempt Organizations’ Annual Federal Returns
A. Federal Income Tax 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.
If you have any concerns, please contact the IRS at
(800) 829-3676 (Form related questions)
(800) 829-1040 (general inquiries)q
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 incorporated nonprofit must have a registered agent with an office location in Iowa. If your registered agent’s office address or registered office address changes, you must submit a Statement of Change of Registered Office and/or Registered Agent with the Secretary of State so that your Articles of Incorporation may be revised.
4. Submit Periodic Reports
Every odd-numbered year, the Iowa Secretary of State requires nonprofits to file a biannual report. You may submit your biannual report online by visiting the Secretary of State’s website.
5. Request Permits and Licenses
Nonprofits in Iowa are not needed to get a state licence or permission. You should, however, check with your city/county clerk to see if there are any local regulations you must follow.
6. Employees
If your organisation intends to hire people, you must register with the Iowa Department of Revenue and Iowa Workforce Development.
If you haven’t previously registered with the Iowa Department of Revenue, you may do so online or via the mail. You may also find contact information on the Iowa Department of Revenue’s website.
To register for unemployment taxes with Iowa Workforce Development, go to the department’s web portal and sign up as a new user.
7. 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.