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Your Annual Compliance “To Do” List

 In Donations & Fundraising, IRS/501(c), Management, Nonprofit Insurance

Do you know what you need to do each year to keep your organization in compliance? There are a few simple, but important, things you must do to keep your nonprofit in good standing with the government. As your nonprofit’s leader, these are the main tasks that must be done. You can do them on your own, or, if it seems a bit too daunting, Legal for Good can help!

Task #1 – Renew with the Secretary of State

In the State of Minnesota, as with many other states, you must renew your nonprofit corporation with the Secretary of State’s Office annually. This renewal must be done in Minnesota by December 31 each year if you do not want your organization to be involuntarily dissolved, it only takes a few minutes to do, and costs you nothing. Go to https://mblsportal.sos.state.mn.us/Business/Search and from here you can submit your annual renewal.

Task #2 – File Form 990 with the IRS

Every 501(c) tax-exempt organization must file an annual return, called the Form 990, with the IRS each year. Your organization’s Form 990 is due 5 months and 15 days after the close of your financial year (unless you request an extension), and it costs you nothing to file unless the form is submitted late. The IRS charges, generally, $20 per day if the Form 990 is received late. The version of Form 990 your organization must file depends on the amount of its financial activity and assets. If your organization’s gross receipts are less than $50,000, you will be likely eligible to file the e-Postcard 990-N. If your organization’s gross receipts are less than $200,000 but greater than $50,000, you will be likely eligible to file the Form 990-EZ, and if your organization’s gross receipts are above $200,000 you’ll likely need to file Form 990. If your charity is a private foundation (have you been involuntarily classified as a private foundation?), you’ll likely need to file Form 990-PF.

Task #3 – Register with the Attorney General

If your organization solicited, or intended to solicit $25,000 in donations, or has any paid staff, it must register annually with the Minnesota Attorney General’s Office as a soliciting charity. If your organization doesn’t raise $25,000, but has $25,000 in assets (cash, land, etc.), the organization must still register with the Minnesota Attorney General’s Office, but instead of registering as a soliciting charity, it must register as a charitable trust. These registrations are generally due at the same time as your organization’s IRS Form 990. If your organization solicits donations in multiple states, you’ll likely need to register with the charity registrar in each of those states as well. Make sure to check the audit requirements for each of those states too, as they may require an audit at a lower threshold than the $750,000 Minnesota audit threshold. Additionally, if your organization has people other than volunteers or paid employees fundraising for you (i.e. contractors or consultants) those people will need to submit a Professional Fundraiser Registration with the Minnesota Attorney General’s Office before they begin fundraising on your behalf.

Task #4 – Get a License from the Gambling Control Board

If your organization conducts any charitable gaming activities, such as raffles, bingo, pull tabs, or the like, you will likely need to get a license from your state’s Gaming Control Board or Attorney General’s Office. You can learn more here: http://mn.gov/gcb/raffles.html

Task #5 – Double Check Your Information

Do you have physical or electronic copies of all your organization’s records and necessary documents? Make sure you have all your board meeting minutes, Articles of Incorporation (original and amended/restated), Bylaws, policies and procedures, financial data, human resources records, contracts, waivers, etc. And, it’s a good idea to back up your files occasionally (don’t forget to back up your e-mail and website too!).

Task #6 – Review Your Policies, Procedures, and Official Documents

Are the organization’s Articles of Incorporation and Bylaws up-to-date? Are they working for your organization, or do they need to be revised? Do your contracts, waivers, policies and procedures, manuals, and other official documents need to be updated? Do you have sufficient insurance coverage to protect your charity’s mission and assets? (Don’t even know what insurance you should have? Learn more here.) It’s wise to do an annual review of these items, as your needs may have changed since last year.

Keeping your nonprofit organization in compliance with the government does not need to be a daunting task! Just create a plan, and set aside a little bit of time each month to achieve your plan. And, remember, Legal for Good is here to help you every step of the way! If you’re not sure what to do, give us a call and we’ll sit down with you and assess your needs. We work hard to make sure your charity is operating optimally so you can focus on achieving your mission, reaching your critical populations, and attaining your growth opportunities.

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