how to obtain attorney general approval for non profit

What are the legal and business matters that require nonprofit board approval?

Some of the most common legal and business matters that require nonprofit board approval are: hiring and firing officers, managers, and key employees, such as the executive director. setting salaries and benefits for officers, managers, and key employees. purchasing commercial or director and officer liability insurance ...

What are the requirements for a nonprofit?

Some of the most common legal and business matters that require nonprofit board approval are: 1 hiring and firing officers, managers, and key employees, such as the executive director 2 setting salaries and benefits for officers, managers, and key employees 3 purchasing commercial or director and officer liability insurance (which offers indemnification for directors and officers) 4 leasing, purchasing, or selling real estate; real estate construction 5 consenting to the terms of loans and other obligations the nonprofit takes on 6 amending the articles of incorporation or bylaws, and 7 issuing classes of memberships, and setting membership dues or special membership assessments.

What is the right to ratify a board decision?

The types of decisions that members might have the right to approve or ratify usually relate to structural changes to the nonprofit corporation, or changes to members' rights or responsibilities, including: agreeing to dissolve the corporation.

How do nonprofits make decisions?

There are two different ways for a nonprofit corporation to take action and make decisions. You can hold a meeting of your directors or members and vote, or your directors or members can sign written consents without attending a meeting . Both methods have the same legal result -- the decision of the board of members is binding and final ...

Where should written consent be kept?

If your board takes action by written consent, the written consent itself serves as documentation of the action. It should be kept in the corporate records book.

Who is responsible for overseeing a nonprofit?

Your board of directors is the primary decision maker for your nonprofit and is responsible for overseeing its management. As a result, your board should approve any decision involving significant financial, legal, or tax issues, or any major program-related matter.

Does a board have to approve a decision?

Not every decision, however, requires formal action or approval by the board. Day-to-day operational matters, such as administrative staff procedures, are usually handled by staff without board involvement. For example, the board may approve the fundraising goals for the year, but the staff can be in charge of the fundraising events.

What are the bylaws of a nonprofit organization?

The bylaws of a nonprofit organization should be written carefully and clearly. Bylaws provide the framework for governance and management of the nonprofit organization. Bylaws regulate the conduct of all members of the nonprofit organization. Generally, bylaws dictate:

What is the purpose of Articles of Incorporation in Pennsylvania?

In Pennsylvania, the format and contents of Articles of Incorporation are governed by the Nonprofit Law which sets forth the specific provisions or requirements that must be met. When forming a nonprofit corporation, it is advisable to engage an attorney to review the law and assist in drafting the Articles. Articles of Incorporation must be filed with the Department of State. Generally, Articles of Incorporation must contain information including, but not limited to, the following:

Why is property committed to charitable purposes protected?

Property committed to charitable purposes has special protection under the law because it relieves the public burden by advancing one or more general or specific charitable causes. As soon as money or property is donated or committed to a charitable purpose, the Attorney General acts on behalf of the public’s interest to ensure it is duly administered; including the assets held by nonprofit organizations formed for charitable purposes.

Do nonprofit boards pay for their services?

Board members and senior managers of nonprofit organizations are not always paid for their services and the bylaws should state whether any individual will be compensated. Individuals are not entitled to compensation unless a clear compensation agreement has been reached. The determination of whether or not to compensate individuals for their services is generally made by the board unless the bylaws provide otherwise.

Can a non profit corporation have shareholders?

nonprofit corporation may elect to have shareholders. If a nonprofit corporation chooses to have shareholders, the fact that the corporation is organized on a stock share basis must be clearly denoted in its Articles of Incorporation. The bylaws should describe the denominations in which shares will be issued and the shares should be evidenced by share certificates. The face of each share certificate must contain a conspicuous statement that the corporation for which it is issued is a nonprofit corporation.

What is an eligible organization?

An "eligible organization" is defined in section 320.5, subdivision (c) as a "private, nonprofit organization that has been qualified to conduct business in California for at least one year prior to conducting a raffle and is exempt from taxation pursuant to Sections 23701a, 23701b, 23701d, 23701e, 23701f, 23701g, 23701k, 23701l, 23701t, or 23701w of the Revenue and Taxation Code." This information can be found on the exemption letter or entity status letter received by an organization from the Franchise Tax Board. If an organization needs a copy of its exemption letter or entity status letter, one can be obtained by contacting the Franchise Tax Board or by using the "Entity Status Letter" tool on the FTB website. In addition, a list of California tax-exempt organizations by category may be found on the Exempt Organizations List page on the FTB website.

How long does it take to get a confirmation of registration?

Depending on volume of registration applications received, staff may not send confirmation of registration for up to 60 days after receipt of the registration application.

How to get FTB exemption for raffle?

The organization must submit its FTB tax exemption letter or entity status letter with the raffle registration application. If you cannot find one of these letters, contact FTB to request a copy. If the organization has never been granted FTB tax exemption, you must file an application with FTB to obtain the requisite tax-exempt status. Please contact the California Franchise Tax Board at (916) 845-4171 for more information.

How long do you have to be a nonprofit to run a raffle in California?

Only eligible private, tax-exempt nonprofit organizations qualified to conduct business in California for at least one year prior to conducting the raffle may conduct raffles to raise funds for the organization and charitable or beneficial purposes in California.

How old do you have to be to be a raffle winner in California?

A raffle must be conducted under the supervision of a natural person age 18 or older. At least 90 percent of the gross receipts from raffle ticket sales must be used by the eligible tax-exempt organization to benefit or support beneficial or charitable purposes in California.

When is the raffle report required?

A raffle report (CT-NRP-2) form is still required if you registered for the 2020 raffle year (09/01/2019 to 08/31/2020) even if you did not hold a raffle or postponed it. Please review the instructions attached to the (CT-NRP-2) form or the Raffles Webinar on how to complete this form.

Can an eligible organization conduct a raffle?

Only an "eligible organization" may conduct a raffle. An "eligible organization" is defined as one that has conducted business in California for at least one year and is exempt from taxation under one of the subsections of Revenue and Taxation Code section 23701 listed in Penal Code section 320.5, subdivision (c).

How to check if a fund raiser is registered?

Check with the Charities Bureau to see if the fund raiser and its professional solicitors are registered and have currently filed the required contracts and financial reports.

Who must disclose the name of the specific professional solicitor?

Any solicitation conducted by a professional fund raiser or any of its representatives ("professional solicitors") must disclose the name of the specific professional solicitor, the name of the employing professional fund raiser and a statement that the solicitor is being paid to raise funds.

What happens if a fund raiser doesn't pay?

Make sure that your organization is given periodic accountings of the fundraising campaign and that the fund raiser is keeping records of funds received and expended during with the campaign.

Why do charities hire fund raisers in New York?

Fund raisers are hired for many reasons. Some organizations do not have sufficient staff to raise funds. Others do not have the expertise necessary to conduct fundraising campaigns. Small organizations may view professional fundraising campaigns as a way to get more people involved in their causes.

How long does it take for a fund raiser to receive funds in New York?

New York law requires that fundraising contracts include the following provisions: If funds are to be received by the fund raiser, within five days of receipt all funds solicited by a fund raiser must be deposited in a bank account exclusively controlled by the charity.

How long does it take for a charity to cancel a contract?

The charity has the right to cancel the contract without cost, penalty or liability within fifteen days after the fund raiser has filed it with the Attorney General. Clear descriptions of the services to be provided by the professional fund raiser and the financial terms of the contract.

Should you read a contract before signing it?

Read all provisions of the contract before signing it. The contract should state clearly all of its terms. If something is unclear, the contract may need revision.

Who can give notice to the Attorney General?

Directors may give notice to, or seek prior approval by, the Attorney General of self-dealing transactions. Notice given to the Attorney General has the effect of shortening the statute of limitations for bringing a civil action to challenge self-dealing. As an alternative, court approval may be sought.

Who must provide advance notice to a charitable trust in California?

Any California public benefit corporation, or mutual benefit corporation holding assets subject to charitable trust, must provide advance notice to, or request waiver of notice by, the Attorney General for the sale or disposition of all or substantially all of the corporation’s assets.

What is incorporation in trust?

incorporation (if not already on file with the Registry of Charitable Trusts) and the articles of incorporation of any other corporation that is a party to the proposed action;

Can a public benefit corporation merge with a religious corporation?

Without the prior written consent of the Attorney General, a public benefit corporation may onlymerge with another public benefit corporation or a religious corporation or a foreign nonprofit charitable corporation. When a public benefit corporation merges or converts into a business or mutual benefit corporation, the Attorney General requires that it first distribute all of its assets to another charity with the same or similar purposes. Applications should include:

Can a director of a public benefit corporation convert to a proprietary corporation?

Directors are not permitted to convert a public benefit corporation that has any assets to any form of proprietary corporation (e.g. a business, mutual benefit, or cooperative corporation) unless they have received the prior written consent of the Attorney General. The Attorney General requires certification that all charitable assets will be transferred to another charity as a condition to consent. Applications should include:

Obtain Tax Certificates

For most nonprofits and churches, this part won’t be an issue, but you will need to ensure that you have no outstanding tax due to the Pennsylvania Department of Revenue or the IRS. You may be wondering how a nonprofit could ever owe taxes.

Obtain Attorney General Approval

The Attorney General of Pennsylvania is granted power by statute to oversee all nonprofit organizations in Pennsylvania. This means that the Attorney General has the power to review dissolutions, mergers and other major changes to nonprofits.

Obtain Court Approval to Sell Real Estate

As an important part of the process, any real estate owned by the nonprofit or the church needs to be sold and the sale or transfer will need to be court-approved.

Ensure that Money Left Over is Transferred to a Similar Nonprofit

As discussed above, dissolving nonprofits should typically give their money to a similar organization. Churches often choose a church within their denomination or a church with similar doctrine. Nonprofits look for organizations with similar missions. A veterans group that is winding up will look for other groups that serve veterans, for example.

Conclusion: A nonprofit attorney can help dissolve your entity

When it comes to winding up a nonprofit, there are many choices you’ll face. Contact the attorneys at Cornerstone Law Firm for a full review of your situation and to discuss next steps in your process.