–Charitable affiliates are often formed by businesses as a means for conducting charitable activities that support the founding organization’s community and social causes. Toews Law Group, Inc., San Luis Obispo attorneys for nonprofits, are well versed and experienced in helping businesses organize charitable affiliates.
In California, the term “charities” applies to tax-exempt, nonprofit public benefit corporations. This means that the organization has filed all the necessary documentation and registered with the California Secretary of State, is also registered with the California Attorney General’s Registry of Charitable Trusts, and has been granted federal and state tax exemptions.
Businesses frequently raise funds for charities and local community organizations as a means of supporting the communities in which they are doing business. It is not illegal for a business to solicit donations for charitable causes in California, but there are some factors to take into consideration when doing so:
- The general public is much more likely to donate to a registered charitable organization than to a business
- In order for donations from the public to be tax deductible, a receipt needs to be issued from the charitable organization, which can create an extra level of record-keeping for the business
- Soliciting donations without the appropriate nonprofit status can open a business to legal scrutiny. Even under the best of circumstances, when all the bookkeeping is in order, and donations are recorded and transferred properly, a business does not need the interruption or the possible loss of goodwill that such an investigation would bring.
Toews Law Group, Inc. has assisted several businesses, service clubs and trade organizations establish charitable affiliates so that these organizations can carry out their charitable activities with as little liability as possible, and continue to support their communities.
Relying on legal experts helps businesses and organizations meet all of the requirements for creating a charitable affiliate in California. The appropriate legal firm can advise about important details such as establishing a board of directors, keeping the appropriate financial records, letters of agreement between the charitable affiliate and the charitable organizations it is helping support, and whether a public benefit corporation, a family foundation, or other kinds of charitable/nonprofit entity is best for conducting the charitable work.
Toews Law Group, Inc. can also help out-of-state charitable organizations file with the California Secretary of State and review and prepare documents to assist California nonprofits to solicit donations in other states.
Toews Law Group, Inc. also assists charitable organizations to form for-profit subsidiaries, which allow them to carry on profitable activities that contribute to their support without jeopardizing their tax exemptions.
Toews Law Group, Inc.
1212 Marsh Street, Suite 3
San Luis Obispo, CA 93401
This press release is by San Luis Obispo publicity company Access Publishing, 806 9th Street, #2D, Paso Robles, CA 93446, (805) 226-9890.