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Should my Church (or other Religious Institution) Apply for Federal Loans offered during this Pandemic?

should my church apply for federal loans

By now, you are likely familiar with the SBA’s loans for hard-hit businesses during this national pandemic. All organizations have been impacted in some way by the coronavirus, including non-profit organizations. It is of some relief to hear that non-profit organization can also apply for governmental relief that is available under the CARES Act, such as the Paycheck Protection Program (although it is currently out of funds and no longer taking new applications) and the Economic Injury Disaster Loan Emergency Advance. Through a set of FAQ’s, the Small Business Administration made clear not only that faith-based organizations are eligible to receive financial assistance under the CARES Act, but also attempted to provide some protection from concerns regarding the impact on religious institutions receiving a federal loan. However, these assurances must be taken cautiously. Positives There are several clarifications that these FAQ’s provide that are encouraging for religious institutions, namely: Religious institutions are included in those eligible for the Paycheck Protection program, regardless of whether they provide “secular social services.”There are no special qualifications for religious institutions receiving these funds. The same limitations that apply to other recipients of these loans apply, including that forgiveness will cover non-payroll costs only up to 25% of the total loan. Loans can be applied to pastoral salaries.Organizations retain their autonomy and ability to make decisions, including the right to define the responsibilities of membership and select individuals to perform work (but see the caution below).Non-discrimination provisions, which are an inevitable part of federal grants, are intended to be...

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So You’re Starting a NonProfit. Here are some FAQs.

Do you have a mission or vision to positively impact others’ lives? Do you see a need that you believe needs to be met by an organization rather than just on an individual basis? Then you may be thinking of starting a not-for-profit organization (“nonprofit”) to help you make these visions a reality. At the White Law Office, Co., we are committed to helping nonprofits succeed. This blog answers some frequently asked questions related to starting a nonprofit 501(c)(3) organization in Ohio. Stayed tuned to the White Papers for further resources for your nonprofit organization. Is every “nonprofit” tax-exempt? No. It is a commonly misunderstood fact that you are not automatically tax-exempt just because you form a nonprofit corporation under State law! A nonprofit is a type of corporation, formed at the state level by filing Articles of Organization with the Ohio Secretary of State. “Tax-exempt” means a nonprofit corporation has been granted federal tax-exempt status from the IRS. Nonprofit does not mean tax-exempt. What exactly IS a 501(c)(3) corporation? 501(c)(3) refers to a specific section of the Internal Revenue Code governing tax-exempt status. It is one of the 29 types of 501(c) nonprofit organizations. A 501(c)(3) organization is a corporation, trust, or unincorporated association that is “organized and operated exclusively for religious, charitable, scientific, testing for public safety, literary or educational purposes, or to foster national or international amateur sports competition...

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How To Start a Non-Profit Organization in Ohio

Starting and operating a non-profit organization can be a little overwhelming. Unfortunately, it can be easy to miss a legal requirement which could jeopardize your organization or your tax-exempt status, if you are also seeking to be tax-exempt. In order to make this process as seamless as possible for you, we’ve put together a shorthand checklist to assist you get your new Ohio non-profit organization off to a great start. Step 1: Name your Organization. This may seem like an obvious step; however, there are certain requirements for naming a non-profit corporation in Ohio. The legal name of your nonprofit corporation must not conflict with any other organization registered in the state. You should make sure the name is available and meets state requirements. Please note, a suffice such as “Inc.” or “Corp.”, is allowable but not required. To search your proposed organization name, go to https://businesssearch.ohiosos.gov Step 2: Recruit Incorporators and Initial Directors. The Incorporators are the people who start your organization. You only need one person to incorporate, who will sign the Articles of Incorporation (See Step 5). Directors, or Trustees, are the people who run the organization and manage its’ corporate affairs. Ohio’s Nonprofit Corporation Law requires a minimum of 3 directors, none of whom are required to be Ohio residents to serve. We do recommend that no more than 49% of your Directors be related by blood or marriage.    Step 3: Have your Directors hold a meeting and elect officers. You are only required to have a president, a secretary, and a treasurer,...

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