If you want to be your own boss and devote your work life to charitable causes, establishing a nonprofit organization could be the best path for you. In Virginia, a nonprofit is established just like a for-profit enterprise, but owners must apply for tax-exempt status with the IRS.
In Virginia, nonprofits must:
Be registered as either a nonstock corporation or a limited liability company (LLC).
Register with the Virginia Department of Agriculture and Consumer Services for the ability to raise funds.
Obtain a business license, and, if required, register with the Virginia Department of Taxation.
A nonprofit organization becomes tax-exempt (allowing individuals and businesses who donate to the organization to deduct their gifts on their federal tax returns) by filing to become classified as a 501(c)(3) organization.
You must fill out IRS Form 8718 and IRS Package 1023. IRS publication 557, Tax-Exempt Status for Your Organization, explains how to fill out these forms. All IRS forms can be obtained by calling (800) TAX FORM or downloading them from http://www.irs.gov.
The Virginia Department of Business Assistance has established a Web site devoted to nonprofit basics and step-by-step formation guidance: http://www.vdba.virginia.gov/non_profit.shtml. The live links will enable you to print required forms and instructions. For more information, contact the Virginia Business Information Center .
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