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Ralph Lambert
07-21-2003, 11:57 AM
Our team is in the process of trying to establish itself as a 510(c)3 not for profit organization in order to facilitate the acceptance of donations and tax free purchases. Has anyone out there gone through this for their team and might have a copy of their bylaws to share with us to get things rolling? Any other advice about the 510(c)3 process would be appreciated.

Joe Matt
07-21-2003, 12:16 PM
Have you contacted FIRST about this yet? Make sure it's OK if you do this. I'm just an pessimist like that. :)

ngreen
07-21-2003, 12:19 PM
Our team gets 501(c)3 designation through our schools designation. It is a lot easier to do this than to become a seperate entity. But I don't know your connection with your school or a school. Good luck.

Kristina
07-21-2003, 03:35 PM
Originally posted by robohyo
Our team gets 501(c)3 designation through our schools designation. It is a lot easier to do this than to become a seperate entity. But I don't know your connection with your school or a school. Good luck.

This is typically the easiest way to go. Standard procedure would be going to your student government or the vice principal in charge of student groups and they should know what you're talking about since many other clubs probably have done the same. Then they should be able to give you the special number that you give to companies to get a tax break.

rees2001
07-21-2003, 03:37 PM
Originally posted by robohyo
Our team gets 501(c)3 designation through our schools designation. It is a lot easier to do this than to become a seperate entity. But I don't know your connection with your school or a school. Good luck.

The same is true for our team. Most businesses will just use the school's Tax ID number. All of our team's funds are run through the school's Robotics Club account. If you are working with multiple schools maybe you can get one of the schools to act as the "main" club. We do not get to buy things tax exempt though. Clubs and activities in NYS are subject taxes, but the donation is still tax exempt & a donation for corporations.

Jeff Waegelin
07-21-2003, 04:01 PM
We go through the Rochester Community Schools foundation, the district's 501(c)3. They take all the money for all three teams in our district, and keep it in an account that we can draw from using our teacher's RCS credit card. If your school or school district has a foundation of some sort, which chances are, they do, that's a whole lot easier to set up than trying to become a 501(c)3 yourselves.

Paul Copioli
07-21-2003, 05:03 PM
Ralph,

We are in the process of getting 501(c)(3) exemption right now, but we created a Non-Profit Corporation first. You really have 2 practical choices when creating your team as an entity: (1) Non-Profit Corporation or (2) an Association. There are subtle differences, but we chose the non-profit route because we wanted to be an actual corporation completely separate from the school system. I have to tell you that the differences were too subtle for me to tell, but our team lawyer (a friend of my family) advised we go the Non-Profit corporation route, so we did. You apply for non-profit corp. status with your respective state and most have the forms and instructions online. I can give you a copy of our bylaws and articles of incorporation when I get them back from the lawyer. If you want to go the association route, then I think Chatsworth High School Team 22 has already successfully gotten their 501(c)(3) exemption as an association.

I am assuming you already downloaded IRS form 1023 (Application for recognition of exemption) and are plunking through the pages of instructions. But if not, then you can also get that from www.irs.gov

We got 501(c)(3) exemption so the school system had no control over our funds. Our team mentors were paying thousands of dollars for items and waiting 8-12 weeks to get reimbursed from the school account and we decided it was better to control our own funds. We currently use our school system's 501(c)(3) exemption, but not for long.

I hope this helps,

Paul

Dan Richardson
07-21-2003, 10:22 PM
Originally posted by robohyo
Our team gets 501(c)3 designation through our schools designation. It is a lot easier to do this than to become a seperate entity. But I don't know your connection with your school or a school. Good luck.

tho this is a good solution for some people its not always good for all.. our school will not allow us to to much in the way of fund raising.. they basically just make sure we can get enough for competition fees and then it kind ends.... Its really restricting and with our team wanting to grow as much as we do its nearly impossible under school restrictions so funding wise we have decided to split

This summer we are applying for a 501(c) I am however not involved with it at all. However what I've been told is its not hard to do but there is a lot of paper work

Your best bet is contacting FIRST and see what they have to say.. and then if you have any friends who are accountants ask them If I can find any other information for you I will pm you

ngreen
07-21-2003, 11:39 PM
I completely understand the problems a team might have by being affiliated with the schools financially. We were a NASA grant team this year but our district would does not allow grant money to be placed into a club account but puts it into a general account. This means that if we didn't spend the money by a certain date it wouldn't roll over. We had plenty of expenses and didn't have a problem with that but had others. The district wanted us to put the money we got from businesses in the general fund instead of the club account because of the large amount of money we brought in for being a club. But our mentor, a small business owner, convince our districts financial officer against it.

As you can see we were generally a financial mess this year. Partly the districts fault and we understand a lot of the fault was ours. We have set up a new financial plan to solve our problems for this year. But I can understand how nice financial freedom would be. Again good luck. Consider all the options carefully and then make the best choice for your personal situation. But still remember that keeping good records is still way more helpful to you financial than becoming an independent corporation.

Amanda Aldridge
07-22-2003, 01:46 AM
Our school funding is also quite restrictive, although they usually pay for what we need. We also have a parent booster club, which has a 501(c)3 designation. That helps sometimes.

Ralph Lambert
07-22-2003, 07:30 AM
Thanks to everyone providing some good advice on this subject. JosephM & Stud Man Dan - FIRST provided no help on this matter other than saying I should go to Chief Delphi.

Paul - I would appreciate a copy of your bylaws when they are available. Yes we are starting down the non profit corp route now.

In general we have kids from a number of schools from different districts and some home schoolers on the team. We get no funding from any school. Having funds flow from a public school to kids from different districts and home schoolers is not easy at times.

Again, thanks to everyone and I appreaciate all the comments.

jonathan lall
07-22-2003, 11:54 AM
Anybody have info on this regarding Canadian law?

Ralph Lambert
07-22-2003, 04:52 PM
I am sure you can look at some of your government sites for information. The Institute on Governance at www.iog.ca offers advice on how to organize non profit organizations.

Ralph Lambert

Carol
10-07-2003, 09:02 PM
365 is just starting to look into trying to get this designation. Since we are not affiliated with a school, it's going to be difficult. Any help is appreciated! Copies of the application (or non-proprietary parts thereof), required by-laws, etc. would help. We are currently trying to identify a lawyer also.

Any advise from those of you who have gone this? Did you register as a public charity or private foundation? What was the key step that got you the designation?

Ralph Lambert
10-08-2003, 12:41 PM
Carol --

We are going through the process now. First you need to get an Employer Identification Number (EIN) using form SS-4. Then, you file articles of incorporation per your state's regulations. In that form we were classified as a public benefit corporation. We needed bylaws for this step. The bylaws need to indicate that you have a board of directors and you keep minutes. Send me an e-mail at relambert@aol.com and I will send you our bylaws. There are samples of bylaws on the web if you search for sample bylaws for non-profit or not for profit corporations. When you get those back you can file with the IRS. You need forms 8718 and 1023. You will need your bylaws and income /expense info from the past and for the future.

We are now filing out the 1023 form.

If you are not affliated with a school how to get through the FIRST registration stuff without identifying a high school partner?

Ralph

Sachiel7
10-08-2003, 03:32 PM
RAPTAR, the 501c3 corporation we founded, is our "backing"
We are an all home school team, so just about the only way we can do funding/sponsorship is with a 501c3. I will talk to my mom (the chairman of the board) and get a copy of our bylaws. We're in the process of updating our Constitution/bylaws though. I remember we had a board meeting, and it lasted for about 2 hours, just reading the bylaws. Heh...It's not your average read...

Carol
10-10-2003, 12:04 PM
Thanks for the offers to help. If anyone has by-laws or other infothat wouldn't mind sharing with us, my email is now active so you can send it me to.

Or if you're going to the Duel tomorrow feel free to bring it with you to our pit.

This is what's great about FIRST - all the cooperation and assistance among teams.

JudyVandy
10-10-2003, 05:31 PM
84, aka Chuck 84, is also in search of info to help with this set up. If you're willing to share from your experience, we'd be very grateful...

Thanks Lots!

PS: We'll also be at the Duel.

Sachiel7
10-10-2003, 06:25 PM
I wish we were at the duel :( :( :( :(
We almost signed up...
Didn't have enough time though :(
I think a digitized version of our bylaws will be uploaded to our website (RAPTAR.org), which we are in the process of re-modelling, so nothing will be there just yet.
I'll post back when it's up.

Ralph Lambert
10-11-2003, 07:28 AM
Here are the steps we are taking to get the 501(c)3 designation for our team.

1. file form SS-4 to get an employer identification number
2. file the proper form from your state to register your articles of incorporation
3. file forms 1023 and 8718 with the IRS
4. file with the state again to get the letter you need for tax free purchases

Along the way you need to create some bylaws that indicate you have at least three directors, the board of directors has meetings and minutes are kept and that you keep financial records. If you write to me at rivercityrobots@hotmail.com I will send you a copy of our bylaws. You can search the web for sample bylaws for non-profit organizations and you will find several examples as well.

Once this process is completed you will have to submit annual reports to the state and I guess to the IRS also.

We are now just in the process of completing the IRS form 1023 so I can keep you updated on how it all worked out.

I have been told that you should expect this to take about 6 months to complete depending on how lucky you are to get timely responses from the state and feds and how quickly you get the forms filled out. The steps need to be completed in serial fashion.

Ralph

Max Lobovsky
08-12-2004, 08:28 PM
1257 is looking to become a non-profit, now. We can handle setting up a non-profit organization, but it appears it might be hard to do in New Jersey. Apparently, good ol' bureaucratic NJ has some rules about forming a seperate organization out of a club or something like that. I have tried looking through Title 18a (Education) of NJ Statutes, but sifting through 77,000 lines of legalese is not easy.

So, have any NJ teams (or teams in other states with such restrictions) formed a non-profit? Can you offer any advice? Thanks.

Carol
08-13-2004, 09:03 AM
I can't help you with NJ, but 365 officially became 501c3 in May! As review, here are the steps involved:

1. Become a non-profit organization. In DE that was pretty easy and just involved filing papers with the state. And paying a fee. We had an attorney help us; a friend who advised us for free. You don't need an attorney but it helps. You do need to have by-laws and officers. You then get a employee identification number (EIN) which you'll need for the IRS.

We actually incorporated not as a team but as a group of adults that was formed to "promote interest in science and technology to middle school and high-school-aged students through participation in the FIRST Foundation robotic competitions and related activities". One of the activities we run is the MOE team (okay, it is the biggest one by far. We do also run the DE Lego League tournament). This might be a way to get around the NJ requirements.

2. Gather all the documentation needed. The hardest part of this was coming up with an estimated budget for the next three years. You also need a description of your fund-raising, list of major sponsors, by-laws, officers, summary of activities, etc. We talked informally with a CPA and a person who works with non-profits (again found through parents) who said it's not as hard as we thought, the IRS is mainly concerned with foundations with lots of assets, not small club type groups like us.

3. Fill out the 501c3 application and send it in with the $500 fee. We heard back in 6 weeks! The IRS sent us a letter giving us provisional tax-exempt status for 5 years, when we will have to re-apply or something. We can worry about that later. We have already used the letter to get a donation from a company who wouldn't donate before, without a 501c3 number. (You use your EIN for that.)

Anyone who has any questions, we'll be glad to help.

Jag
06-23-2005, 08:05 PM
We are starting a new team and also starting a new 501 (c) 3. If anyone has been though the 501(c)3 procedures and would not mind shaing some of their expereinces and documents we would surely appreciate it.

We are looking for Bylaws and Articles of Incorporation expecially to look at and model after. Hate to ask but we are a little behind the game in getting the team started. We actually decided not that long ago to start the team after our multi school veteran team ended (lonnng story)

Any and all help would be highly appreciated.

Jag-

Leon Machado IV
06-23-2005, 08:16 PM
I was working on starting my company to support FIRST as a 501(c)3 until that kinda fell apart (moreso due to people then anything). I will gladly help anyone organize documents and whatnot and hope they have more luck then I did in the organization. Feel free to email me at leon.machado@gmail.com. Thanks.

Ralph Lambert
06-23-2005, 10:02 PM
Jag -- You can view several of my posts above and also e-mail me at rivercityrobots@hotmail.com and I will send you our bylaws and any new info I have since we got our 501(c)3 ruling.

RoboMom
06-24-2005, 07:55 AM
You might want to check also if your local school board has a 501(c)3 you can use. Some programs set up accounts through existing programs (lots of school systems do this with Destination Imagination, for example. The oversight and administration are offered. Depends on how you want to run your team.
Good luck.

Carol
06-24-2005, 08:29 AM
MOE became 501c3 last year and saw an immediate benefit in donations. I'll email you our by-laws as well (initially based on the ones that Ralph graciously sent us from River City Robots, but modified since).

We have recently changed the requirement for yearly audit of our books to yearly review. We found out that "audit" has a specific legal meaning and requires paying a CPA.

Our 501c3 organization is officially First State Robotics, Inc., which coordinates several programs such as the MOE team (the biggest) and the state FLL tournament. (Side note - the name is a play on words as the nickname for the Delaware is the First State. Legally we couldn't use FIRST, as in the legal entity For Recognition, etc.) The board of First State Robotics oversees and funds the various programs, each of which has its on governing board or group of some sort. In reality the various boards all have the same people in multiple roles, but we are working on getting more people involved in order to spread the workload.

stealth13777
06-24-2005, 11:34 PM
Just curious, but does it cost anything to get 501(c)3 designation? I know one person posted that it cost them $500, while others made it seem as though it was little to no cost. Our budget is fairly limited right now so I'm hoping this designation can be achieved at little to no cost. Thanks in advance

Jag
06-24-2005, 11:52 PM
From everything that I am seeing and reading it is a $500.00 fee and also you have to print your Articles of Incorporation in the paper for (3) consercutive days and I am estimated that is about $200.00.
I am no authority by any means.. this is just what I am told and quoted as we are working through all of this right now. I would love to hear otherwise if someone knows differently.



Just curious, but does it cost anything to get 501(c)3 designation? I know one person posted that it cost them $500, while others made it seem as though it was little to no cost. Our budget is fairly limited right now so I'm hoping this designation can be achieved at little to no cost. Thanks in advance

Gdeaver
06-26-2005, 12:24 AM
I have a question for teams that have gone independent from a school district. How do you handle insurance? Our robot team is an official school district sponsored team. Both the students, teachers, and outside mentors are covered under the school districts policy. The coverage and protection is considerable however, there is allot of bureaucratic demands placed on the teacher in charge. In the past, some adult mentors looked at moving the team to a Scouting America venture club. The venture club looked like it would solve the insurance and non-profit issues. Our school district more or less said it's their way or good luck. No money, no support, no free use of facilities. How is this handled by independent teams?

Carol
06-27-2005, 08:58 AM
Just curious, but does it cost anything to get 501(c)3 designation? I know one person posted that it cost them $500, while others made it seem as though it was little to no cost. Our budget is fairly limited right now so I'm hoping this designation can be achieved at little to no cost. Thanks in advance

The costs and requirements vary widely by state. We incorporated in DE (which isn't known as the Corporate Capital of the World for nothing :D ). It was fairly easy, just filing some papers and sending in the money. I believe it was $89 to incorporate and $30 for a copy of the certficate. I got all the information from the state web site.

Carol
04-20-2006, 01:17 PM
We (MOE 365 mentors) are presenting a paper at the Robotics Conference at the Championships in Atlanta on "501c3 Status, What is It, How to Get it, and Why do I Need It?" If you have gone through the process and are willing to give us some input for the talk, please contact me. Obviously in the next day or two as we are finishing up the talk this weekend (I do my best work at the last minute.)

JaneYoung
04-20-2006, 01:50 PM
We've done this. 3 years ago.
If I can be of any help, please pm me.
Jane

Ralph Lambert
04-21-2006, 09:00 AM
I can provide some additional information on the time line and costs to become a 501(c)3. The steps for the process were provided in my 10-11-2003 post in this thread. You can probably get this done a bit faster but this was our experience: Applied for EIN from IRS on 7/31/03 for $35. Got our original charter of incorporation from Missouri on 9/1/03 for $25. (It sounds like this varies widely from state to state.) Submitted our form 1023 to IRS on 10/28/03 for $500. The IRS asked us to make some modifications to our bylaws and our Missouri articles of incorporation. Submitted for an amended articles of incorporation to Missouri on 12/29/03 for $10. Received our IRS ruling letter in March of 2004.

The IRS was very concerned about the distribution of the organization's assets upon dissolution of the organization. They gave us the paragraph to include in our bylaws and articles of incorporation.

Our bylaws, ruling letter and state charter can be found on our website at www.rivercityrobots.org. Click on ABOUT and you will see some the links to these documents on the right side of the screen.

Insurance is still an open issue with our organization. It would be nice to hear from other 501(c)3's on this subject. We are not affiliated with any school or other agency. We are just a regional team taking students from any school in the county. We could not convince our local schools to have a team or even to recognize our team so we have no insurance shirttails to ride.

If I can provide any additional information you can post here or e-mail me at rivercityrobots@hotmail.com

Carol
05-04-2006, 03:40 PM
Our presentation at the robotics conference titled "501(c)(3) Nonprofit Status - What Is It, Do We Need It, and How Do We Get It?" went very well (in my opinion anyway). Thanks to those of you who helped with suggestions for it. The slides can be found at http://moe365.org/moeu.php

I got a message a month or two ago from someone who wanted help in this area. I told her I would get back to her, but unfortunately I can't find the message now. If you're out there, I apologize - please contact me again!