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Executive Service Corps
of Chicago
25 East Washington
St. Suite 1500
Chicago, Illinois 60602
312.580.1840
info@esc-chicago.org
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These guidelines are supplied by Executive Service
Corps of Chicago. Once you have secured 501(c)(3) status, ESC can provide
technical assistance relative to board and/or management issues.
STEPS TO BECOMING A 501(c)(3)
Incorporate as an Illinois nonprofit corporation
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You file Form NP-102.10 Articles of Incorporation along with a $50
registration fee to the Illinois Secretary of State. It should take two
to four weeks for confirmation and receipt of your charter. Your
agency’s name must be different from all other names on file. You can
verify this by calling Springfield 217-782-9521 or write The Secretary
of State, Centennial Building, Corporate Department, 3rd
Floor, Springfield IL 62756.
- If
you intend to file later for IRS tax-exempt status, Section 5 of your
Articles of Incorporation MUST contain appropriate
purpose, inurement and dissolution clauses. They must also be included
in your By-laws. There is a standard language available (see
supplement).
File with Recorder of Deeds
After you have received your charter from
the Secretary of State, you should put it on file with the Recorder of
Deeds in the county in which you are registered. There usually is a fee
involved.
Register with State and Federal Offices
- Apply to the IRS for a Federal Employee Identification Number
(FEIN). This will take about four weeks to process. It is required on
all federal and state tax reporting forms. You may expedite the process
by calling the IRS in Cincinnati, OH, 1-800-829-4933 or FAX
1-859-669-5760. They will supply the number over the phone, but you
will still have to send the required SS-4 form to IRS Service Center,
ATTN: EIN Operation, Cincinnati, OH 45999.
- Apply to the Illinois Department of Revenue on Form NUC-1. If you
have already received your FEIN number (see 1 above), that information
foes on the Illinois form. If you have filed but are waiting for your
assigned number, mark the form “applied for” in the appropriate space.
- Both Illinois and IRS will send you Forms IL94 and IRS-941
respectively at the end of each calendar quarter on which you must file
tax-withholding information. Even if you have no paid employees you
should still file the forms and mark “no employees.”
Application for Tax Exempt Status (IRS Publications 557, 1023 and
1024)
Most contributors to your agency will
expect you to have qualified as a 501(c)(3) corporation with the IRS. To
obtain this status, you must complete IRS Form 1023 found in the
instruction book (1023). It is strongly recommended that you use the
services of a knowledgeable attorney for this step. You must include
a two-year proposed budget, your FEIN number, a copy of your Illinois
Charter and a signed and dated copy of your By-laws.
Form 872-C in the back of
the book must also be included. This form allows IRS to assess your
organization for excise taxes as a private foundation if you somehow do
not qualify as a tax-exempt public charity. Finally, you must include
Form 8718 plus a $150 filing fee if your past or current contributions
are less than $10,000. If they exceed this amount, the filing fee
increases to $500. This application process can take up to six months
for approval. In the meantime, you may indicate to prospective
contributors that an “Application for 501(c)(3) exemption is pending.”
Illinois Sales Tax Exemption
When you have been granted
IRS 501(c)(3) status, you can then apply to the Illinois Department of
Revenue for exemption from State sales tax. You will be assigned a sales
tax exemption number. Until that is received, you will be required to pay
all such taxes.
SUPPLEMENT
Following are the articles of purpose,
inurement and dissolution that must be included in your Articles of
Incorporation.
Purpose – The
Corporation is organized exclusively for charitable, educational,
religious or scientific purposes within the meaning of section 501(c)(3)
of the Internal Revenue Code.
Inurement of Income
– No part of the net earnings of the corporation shall inure to the
benefit or be distributable to its members, trustees, officers or other
private persons except that the corporation shall be authorized and
empowered to pay reasonable compensation for services rendered.
Dissolution –
Upon dissolution of the corporation, the Board of Trustees, after paying
or making provisions for the payment of all liabilities of the
corporation, will dispose of all assets of the corporation exclusively for
the purposes of the corporation in such a manner, or to such an
organization or organizations organized and operated exclusively for
charitable, educational, religious or scientific purposes as shall at the
time qualify as an exempt organization or organizations under section
501(c)(3) of the Internal Revenue Code of 1986 (or the corresponding
provision of any future United States Internal Revenue Law), as the Board
of Trustees shall determine.
Organizations which
can provide assistance: |
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Nonprofit Agencies
Community Economic
Development Law Project
100 N. LaSalle St., Suite
600
Chicago, IL 60602-2403
312-939-3638
Pro bono
legal services for eligible not for profit organizations
CPA’s for the
Public Interest
550 W. Jackson, 9th Floor
Chicago, IL 60606
312-993-0407
www.cpaspi.org
Accounting assistance for emerging agencies
Donors Forum
208 S. LaSalle #735
Chicago, IL 60604
312-578-0090
www.donorsforum.org
Information library for funding sources
Illinois Industrial Commission
Workers Compensation Division
100 W. Randolph, Suite 8-200
Chicago, IL 60601
312-814-6500
Information Technology Resource Center
29 E. Madison, Suite 1005
Chicago, IL 60602
312-372-4872
http://itresourcecenter.org
Hardware/software information & training
National Council on Compensation Insurance
2050 W. Iles Ave.
Springfield, IL 62704
217-793-1100
Worker’s Compensation Insurance

Nonprofit Financial Center
www.nfconline.org
29E. Madison, Suite 1700
Chicago, IL 60602
312-252-0420
Publishes: Do it Right the First Time, Starting a Nonprofit Organization
in IL
Support Center of Chicago
30 E. Adams St., Suite 1600
Chicago, IL 60603
312-263-5118
www.sc-chicago.org
Management workshops for nonprofit agencies
United Way/Crusade of Mercy
312-491-7823
Board Placement Program |
Government Agencies Cook County
Recorder of Deeds
118 N. Clark Street Rm. 120
Chicago, IL 60602
312-443-5050
Registering new corporate charter
Secretary of State Dept. of Business Services
Corporation Division
17 N. State Street, Suite 1137
Chicago, IL 60602
312-793-3380
or Corporation Division
Howlett Bldg.,
501 S. Second St., Rm. 315
Springfield, IL 62756
217-782-6961
IL Attorney General
Division of Charitable Trust & Solicitations
100 West Randolph, 3rd Floor
Chicago, IL 60601
312-814-2595
http://www.illinoisattorneygeneral.gov
IL Dept. of Employment Security
33 S. State St.
Chicago, IL 60605
Forms & General Assistance
1-800-247-4984
Tax Problems
1-800-247-4987
IL Department of Revenue
State of Illinois
Dept. of Revenue, Income Tax Division
100 West Randolph, 7th Fl
Chicago, IL 60601-3274
312-814-5232
or 101 West Jefferson
POBox 19001
Springfield, IL 62708
1-800-732-8866
To reach any other state agency not listed, call:
1-800-829-1040
Internal Revenue Service
Form Services Division
230 S. Dearborn
Chicago, IL 60604
1-800-829-3676
For form pickup only:
320 W. Washington, Room 611
Springfield, IL 62703
217-527-6000 |
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* these general guidelines are for
information purposes, the procedures can change, so be sure to contact the
appropriate organizations for up to date detailsUS
Government Publications
Publication
4220, Applying for 501(c)(3) Tax-Exempt Status, is designed to help
prospective charities apply for tax exemption under the tax law.
Publication
4221, Compliance Guide for 501(c)(3) Tax-Exempt Organizations,
explains the record keeping, report filing, and disclosure rules that
apply to organizations that have tax-exempt status under section
501(c)(3).
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