Empower Your Non-Profit Organization to Convert to Sales for Non-Profit Organizations

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hey y'all it's tiffany with boss in the budget i help new and small nonprofits get up and running so if you need help with your nonprofit or if you need help raising money for your new non-profit make sure you subscribe to this channel because i drop videos all the time i really wanted to do this video because there's a lot of confusion around the startup process in general especially when it comes to locs it's like llcs are like a buzzword or something in the startup space and a lot of people assume that like that's the first step for starting any kind of business and so i want to just kind of clear this up when it comes to nonprofits first things first you're going to hear me say this a lot in this video but i'm going to make sure i get it out the way immediately if you are asking questions about your llc and how to turn into a non-profit you really need to speak to an attorney or a paid professional like an accountant right or a consultant who can walk you through this information based on your individual circumstances when it comes to setting up business entities it's very specific to the state you set it up in and it's also very specific to what your needs are and so you may be listening to a general youtube video and i understand that you have a certain situation that you need to consider in everything you're trying to decide for the direction of your non-profit so i'm just going to say this this is not going to be the only time you're going to hear this but it'll be the first time you need to speak with an attorney this is just general advice i'm going to give you general information to help guide you through that conversation once you talk to somebody so you understand the things to consider and what to be mindful of but please talk to somebody if you're confused about your llc and turning it into a non-profit now in this video when i'm talking about nonprofits i mean a non-profit that's seeking 501c3 status now the reason why i'm doing this video is because i get this question a lot when i talk to people on the phone a lot of people will be really gung-ho about starting a business so they'll start in a business and create an llc thinking that that's the first step and then they can get 501c3 status this is what i want you to keep in mind though generally if you are an llc you are not able to get 501 c 3 status but i'm going to slow up this because there are so many caveats around this and i want to make sure you get it okay so there is actually a process where llc's can get 501 c 3 status there is a process in place but it's a convoluted process and the members of the llc have to also be 501 c 3s it's a really layered process it's complicated and more than likely it does not fit your particular situation if you're just one person who thought you needed to do an llc first so let me just put that out there right so if you do look up this information you're gonna see that llc's can possibly apply for 501c3 status but it's under certain circumstances that usually don't apply to you so when you're just a person wanting to start a non-profit because you have a passion and a vision you need to be setting up a corporation in your state a nonprofit corporation now this is again why you need to speak to a lawyer who understands your specific situation because there are different types of business entities that you can set up in order to get 501 c 3 status you could possibly be an association you could possibly be a trust depending on what you want to do generally if you're doing direct services and you're serving the public generally you're going to be set up as a non-profit corporation right and usually when i talk people through the startup process that's the assumption that you are a non-profit corporation so i broke some of this down in a video that i did called what are the articles of incorporation i'm linking that above and i'm also providing it in the description box so you can easily find it so you can understand like the process of incorporating right now i'm going to walk through a little bit more of this but i also want you to stay to the end because if you're in the position where you've already created your llc and you're like oh snap i didn't realize i shouldn't have done that what do i do now i'm going to share at the end of this video what you should do next okay so let's finish up our conversation talking about llc in terms of being a non-profit and getting 501c3 status when you're setting this up at the state level be sure that you're actually setting up a non-profit corporation because there are for-profit corporations and they have different names from state to state and my home state is called a stock corporation or non-stock corporation now when i set up my very first non-profit when i was a grad student way back in the early 2000s i had no idea what that meant i had never heard of the word non-stock i had no clue right and so if you don't know the language in your state and you don't do the work to figure out like the differences between the two you can make some mistakes right and you don't want to do that in this process it's very important that how you set up your your nonprofit what you put on your application to the irs is correct because one thing like one mistake can take you down a really costly road so i did a video called the number one mistake that people make applying for taxes and status because i try to lift up these things for people because if you can't afford for people to do this for you you just need to know what to look out for so i'm linking that video above and also i just want to mention my non-profit startup master class and i recorded a master class for over two hours where i talked through like how to set up your nonprofit the strategy behind it but also like the logistics and what to do and what language you need to make sure you have in your articles of incorporation and how to make sure you fill out the applications and make sure you check this box and not check this box down to that level so if you're interested in that if you need help like that then make sure you check out the non-profit startup masterclass so if you're still watching this video you might be one of those people who set up your llc thinking you can get 501c3 status and you may be saying to yourself now what am i supposed to do now this process really does depend on the state so i'm going to walk you through some alternatives or some options but they may not be an option for you depending on your state so some sometimes your state will allow you to kind of change the business structure they may have a form where you can change it right where you can transfer things or you can switch things over especially if you're a new non-profit or if it's less than a year that you got started right so you need to contact the secretary of state's office and see if there's some kind of form you can use to transfer or change the entity type easily the other option is for you to completely dissolve the llc and just start over start from scratch just create your non-profit corporation like you were supposed to in the first place and just dissolve the llc right and again i'm giving these as options but a lot of this depends on the state and it depends on what you're advised to do from a lawyer i'm only given that option i'm just giving you general advice another option for you may be that you keep the llc and the llc somehow is in support of the nonprofit maybe some of the earned income from your llc can be used to donate to support the activities of the nonprofit a lot of people do that and you're completely within your rights to do that as long as you're following the rules so that may be another option for you as well so you have three potential options and there may be even more options that i don't know of because i don't live in your state that are available to you if you kind of started off on the wrong foot and went forward with an llc i hope this information was helpful to you all i hope you were able to learn something and if you feel like somebody else in your circle needs this information don't forget to share this video with them or just to tell them about boss in a budget and tell them about the work that i do to support new nonprofits because we all need each other right and a lot of times people hold information they don't like to share they're territorial and you're just trying to do a good thing you're just trying to live out your vision what's been placed inside of you so i want to kind of get through those barriers and give you the information and the facts so you can make good decisions and get started on your way so thank you so much for watching if you need more help make sure you check out .bostonbudget.com and i will see you in the next video [Music] you