Forming a nonprofit organization can be perfect for people who want to be their own boss and devote their work to charitable causes. A nonprofit is established just like a for-profit enterprise, with the additional step of applying for tax-exempt status with the Internal Revenue Service.

In Virginia, nonprofits must:

- Be registered as either a non-stock 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 local 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 an application to become classified as a 501(c)(3) organization.

Necessary forms include IRS Form 8718 and IRS Package 1023. For instructions on filling out these forms, read IRS publication 557, Tax-Exempt Status for Your Organization.
All IRS forms can be obtained by calling (800) TAX FORM or downloading them from http://www.irs.gov.

The Business Information Center of the VDBA can e-mail you a step-by-step explanation with live links to numerous resources and all required forms and instructions. Call (866) 248-8814 to request nonprofit instructions or e-mail your request to vbic@vbda.virginia.gov.

Business One-Stop to be unveiled in 2008

Starting a business in Virginia will become easier in early 2008 when the online “Business One-Stop” is introduced.  Entrepreneurs accessing the one-stop site will need to answer only a few simple questions to receive detailed information on the registrations, licenses and permits required.

Debut date of the new “Business One-Stop” will be announced on the Virginia Department of Business Assistance Web site, http://www.vdba.virginia.gov and the Virginia Business

Portal, http://www.business.virginia.gov.

The University of Virginia’s Weldon Cooper Center for Public Service unveiled the Virginia Poverty Measure on Wednesday as part of an effort to more accurately reflect the economic conditions of the commonwealth.
Using the new measure, the Cooper Center found that, despite the region’s high median income, 12 percent of Northern Virginia residents are in economic distress, on par with a new state poverty rate of 11.9 percent.
“Northern Virginia’s particularly high cost of housing and other goods is to blame,” lead researcher Dustin Cable said in a statement. “The new measure’s poverty rates for Virginia better conform to our commonsense understanding of the actual resources available to families, and the necessary costs they face. A one-size-fits-all poverty measure that ignores regional differences doesn’t make sense.”
On the other hand, the new measure also reports significantly lower poverty rates for Southwest Virginia, a region that is typically shown as having particularly high poverty rates.

“Although Southwest Virginia still has the highest poverty rate in the state under the new measure [16 percent], it looks much more like its neighbors to the east,” Cable said. “The region is no longer an outlier in terms of economic deprivation. Accounting for a broader array of anti-poverty programs under the new measure helps lower rates in this region, as well as in Southside, the Northern Neck, the Valley and the Piedmont sections of Virginia.”

Among other findings from the new measure is a significantly lower poverty rate for children. Cable points out that the new poverty measure accounts for a broader array of anti-poverty programs and tax credits that are preferential toward families with young children, such as the Earned Income Tax Credit and food stamps. By including these programs in the calculations of family resources, fewer families with children are found to be poor. On the other hand, by including the costs of medical out-of-pocket expenses, more seniors are found to be in poverty.

The Cooper Center says the Virginia Poverty incorporates contemporary spending patterns; accounts for regional differences in the cost of living; and includes in family resources the effects of taxes, government programs and medical expenses.
“Through the creation of the Virginia Poverty Measure, the commonwealth joins a handful of states taking steps to dramatically improve the way the nation has measured poverty for more than 50 years,” said Qian Cai, director of the Cooper Center’s Demographics & Workforce Group. “The methodology developed in Virginia extends the work done earlier in other states, has the potential to be a national model and can be applied by U.Va. researchers to other states using state-specific data and conditions to understand poverty among their citizens.”