Spring 2009 Spring 2009 ConventionConvention

Inter - Chapter Inter - Chapter LuncheonLuncheon

Steps to IncorporationSteps to Incorporation

To Become a ChapterTo Become a Chapterthen…then…

• Chapter Name

• By Laws

• Federal Employer Identification Number

(EIN)

• Bank Account

• Chapter Charter

To Become a ChapterTo Become a ChapterNOW…NOW…

• Chapter Name

• By Laws

• Federal Employer Identification Number

(EIN)

• Bank Account

• Chapter Charter

• Incorporate in Your State

• Apply to IRS for Non Profit 501 (c) (6)

Chapter NameChapter Name

• International Concrete Repair

Institute – North Texas Chapter

or

• Arizona Chapter of the International

Concrete Repair Institute

By LawsBy Laws

• Details about operations– Name

– Object

– Members

– Officers

– Meetings

– Executive Board

– Committees

– Authority

– Amendments

Then…Then…

• Federal Employer Identification Number

(EIN)

– Obtained by IRS form SS-4

• Bank Account

– A checking account in the chapter’s name

• Chapter Charter

– ICRI National Approval of Chapter

The 990 Change The 990 Change

• Why the change at the IRS?• IRS wants to know what’s going on inside

nonprofit organizations • To file you must be a 501(c) (6)

organization• ICRI is• Chapters are not

Organizational Organizational ProblemsProblems

• What happens if we are not a non-profit?– You should be paying taxes like any other

corporation• Aren’t we under ICRI’s

exemption?– No, Each chapter a separate legal

organization. No group exemption.

Step One - IncorporateStep One - Incorporate

• Incorporate with your state– Every state has different processes, forms, paperwork– Prepare Articles of Incorporation– They are rules governing the management of a corporation– The Articles of Incorporation introduce your organization

to government agencies– Your By-Laws are designed to introduce your organization

to the members they serve.

Step One - IncorporateStep One - Incorporate

A corporation's Articles of Incorporation generally provide information such as:

• The corporation's name, which has to be unique from any other corporation in that jurisdiction.

• The name of the persons organizing the corporation, usually members of the board of directors.

• Whether the corporation is a stock or non-stock corporation – CHOOSE NON-STOCK

Step One - IncorporateStep One - Incorporate

• Whether the corporation's existence is permanent

or limited for a specific period of time.

• A corporation must state the purposes for which it is

formed. Some jurisdictions permit a general

statement such as "any lawful purpose" but some

require explicit specifications.

Step One - IncorporateStep One - Incorporate

• Example: The corporation is organized exclusively to

promote a common business interest and improve

business conditions of a line of business with the

meaning of Section 501 (c) (6) of the IRS Code of

1986. In furtherance of these purposes, but not by

way of limitation, the purpose of this organization is

the promotion of higher business standards, better

business methods and improvement of business

conditions in the concrete restoration, repair and

protection industry through the education of its

membership.

Step One - IncorporateStep One - Incorporate

• If a non-stock corporation, whether it is for profit or non-profit.

• In the United States, if a corporation is to be organized as a non-profit, to be recognized as such by the IRS, such as for eligibility for tax exemption, certain specific wording must be included stating no part of the assets of the corporation are to benefit the members.

• The names of the corporation's current Board of Directors.

• The location of the corporation's "registered office" - the location at which legal papers can be served to the corporation if necessary. Some states further require the designation of a Registered Agent: a person to whom such papers could be delivered.

Step One - IncorporateStep One - Incorporate

• File the Articles of Incorporation with the appropriate state officials or agency to be recognized as incorporated.

• You will need your By-Laws and approved Articles of Incorporation to be filed along with your Form 1024 in order to be recognized under section 501 (a).

Form 1024Form 1024

• Apply to become a non-profit with IRS– Form 1024 (19 pages)– Articles of Incorporation– By-Laws– Form 8718

• IRS will issue a Determination Letter

Form 1024Form 1024

• Form 1024 is 19 PAGES!!!!!!!

• Worry about pages 1-5 and 9 only.

Form 1024Form 1024

• Part I• First choose (d) • Section 501 (c) (6)• Business leagues, chamber of

commerce, etc.

Form 1024Form 1024

Starting with number 1

a.Nameb.President’s namec.Addressd.City, State and Zip Codee.Web site (if applicable)

Form 1024Form 1024

2. EIN #

3. Name and phone

4. End of accounting period

5. Date of incorporation

6. No

7. No

8. Choose option A – Corporation

- end of page 1 -

Form 1024Form 1024

Part II

1. Narrative Description of Activities

1. Type of event

2. Purpose of event

3. General frequency of this type of event

4. Where held (be general, no single location or specific)

5. Who conducts the event (by the Board members, etc.)

Form 1024Form 1024

Part II

2. List sources of financial support

1. Event fees

2. Event sponsors

3. Dues

4. Ad revenue from newsletters

5. Other sources

- end of page 2 -

Form 1024Form 1024

Part II

3. (a & b) Provide a list of Officers and Directors

Include name, address, title in chapter

organization and compensation - Zero

4. Not applicable

5. List the International Concrete Repair

Institute

6. The chapter has no stock

Form 1024Form 1024

Part II

7. Types of Members

Member of the chapter are members of ICRI.

Include types of members and number

General Member, students, lifetime, honorary,

etc.

8. Dissolution – use statement from By-Laws

- end of page 3 -

Form 1024Form 1024

Part II

9. No – we are non-profit

10. No – the group goes not charge for their services

11.No payments to shareholders

12. No, the chapter does not provide insurance

13.Not under supervision

14. Property lease – you can mention rentals of space

for meeting, but only if you have a contract

Form 1024Form 1024

Part II

15. No political influence

16. Attach copies of a few recent newsletters

or communications to members regarding

upcoming or planned activities.

- end of page 4 -

Form 1024Form 1024

Part III

Statement of Revenue and Expenses

Basic information that is the same as the

financial reporting for ICRI and Chapter

Awards forms

- end of page 5 –

Form 1024Form 1024

Pages 6 through 19 are all for a varies of

other organizations filing under Section

501 (a)

C9’s C4’s, C7’s, etc.

On Page 9 you can refer back to

Part II, Question 1 – your narrative regarding

types of meeting and events you provide

the members

YOU HAVE JUST COMPLETE ALL

THE STEPS

The Best Advice…The Best Advice…

• Talk to your professional (Lawyer/Accountant)– Non-profit experience a plus

I have the name and number of a great firm that is willing to work with you on this process. There may be some issues with certain states, but it will be discussed up front.

QUESTIONS?