Nonprofit Law/Activate my 501c3

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Question
I had a sole propertiship, which I transition too a 501c3 corporation.  I want to reactivate and move it to Maryland.  It is The Anthony R. Wortham, School for the Performing Arts, Inc.  I am also applying for at curatorship at the Grove Farm properties Historical plantation in earleville MD, Can I receive donations and grant funds while i am doing the transition?

Answer
It is not clear from what you wrote whether you have already incorporated in the State of Maryland as a nonprofit corporation.  If you have, then you can then become active and receive donations and grant funds after you obtain an EIN (Employer Identification Number - or Taxpayer Id number) for the corporation and open the corporate bank account.

The organization must have certain IRS-mandated clauses
in the organizational document even if your organization
is not required to apply for federal exemption but if you
want the benefits of being an exempt organization.
See, starting in the middle column of page 26 of
Publication 557  under "Organizational Test". Samples
start on page 77 and the IRS discusses some of the
textual requirements for the organizational document
starting in the middle of page 26 of their Publication
557 and going through the paragraphs under the heading
"Dedication and Distribution of Assets" on page 27.
http://www.irs.gov/pub/irs-pdf/p557.pdf

The IRS may take months to issue the exemption determination
letter, but as long as you file your exemption application within
27 months and are approved for exemption status by the IRS you may
begin full operations upon state incorporation.
See IRS Publication 557 "Tax Exempt Status for Your Organization"
http:// www.irs.gov/pub/irs-pdf/p557.pdf
which has on page 23, middle column, under the heading "Effective
date of exemption" that the exemption determination is granted
retroactively to the date of formation which is normal for
501(c)(3) organizations that apply for exemption within the first
27 months of their formation. "If the organization files the
application within this 27 -month period, the organization's
exemption will be recognized retroactively to the date it was
organized."

Harvey Mechanic
Attorney at Law
Harvey108@hotmail.com

P.S. This response is intended to be a general statement of law, should not be relied upon as legal advice and does not create an attorney/client relationship.

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Harvey Mechanic

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I am an attorney and I volunteer time to answer general questions about U.S. Federal income tax issues of nonprofit 501(c)(3) public charities only. Those questions could be about establishing and maintaining legal requirements for such non-profit organizations in the United States, including Internal Revenue service filings and requirements. I will not be working on this free forum to answer questions about Nonprofit's possible unrelated or for-profit businesses or how to fill out forms. This forum is only for general questions about federal tax law, not as the law applies to your specific situation. If you do not make your question public then I will not be spending much of my donated time on answers that would not benefit the public. If you have other questions, please contact me at Harvey108@hotmail.com I will reply from my email. In any case, do not reveal confidential information to me until after I have contracted with you to provide personal legal services. My responses on this forum are intended to be general statements of law, should not be relied upon as legal advice, and do not create an attorney/client relationship. For me to consider your individual situation and how the law applies, I would need to gather extensive information about the situation. To search my previous answers you can do a Google search by "site:allexperts.com/q/nonprofit" without the quotes and then add your search terms before hitting enter.

Experience

I have been practicing law and especially the law of nonprofit organizations since 1990 when I was admitted to the New York Bar and I have maintained my status with the Bar since that time.

Education/Credentials

B.S. Columbia University in New York City, 1970

J.D. (Law Degree) Brooklyn Law School, 1990 -- Cum Laude.


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