NPO 501c3_________________________________________________________

JETAA New York

Rob Tuck, PresidentCJ Hoppel, Treasurer

Current Status (continued)

• Northern CA and NY are currently the only 501c3 organizations (N.CA established 1994)

• JETAANY incorporated in 1996• 2002 – decision not to explore 501c3• 2005 – new leadership / issue of

future GIA• 2006 – granted 501c3 status

Goals / Progress

• Many chapters already incorporated• Looking to get all chapters

incorporated, and all chapters 501c3.

Chapters not incorporated? Future plans?

Inc. 501c3• Chapters encouraged to start 501c3

process• Advantage: Bylaws required for GIA• Bylaws first step for NPO• MoFA funding is temporary

– Original plan: funding = seed money– Purpose: build base & reputation in community

• Rumors re: GIA– Future funding not guaranteed– Not sudden / instantaneous

• 501c3 status is expected in future

Multiple Forms of NPO• 501c(3), (4), (6), (7)• JETAA only fits (3) and (7)• (3) = community focused

– Accepts tax deductible donations– Funding from outside sources– Political lobbying not permitted

• (7) = social organization– Does not accept tax deductible donations– Funding from within membership– Political lobbying OK

Why NPO 501c3?• Currently – none (or very little) self-generating

funds for most organizations. So, why 501c3?• Focus: membership 501c7 – Social Club

– Posting jobs– Apartment search network– Happy hours– Social gatherings

• Focus: community relations 501c3– All of the above +

• Outreach with local Japanese organizations• Offer scholarships• Grants available for members/students to develop relations

with Japan/Asia

Our Decision

JETAANY – 501c3

Social, Jobs & Housing Services +

• Maintain long-term options open

• Develop scholarship & grant possibilities

• Strengthen ties with local Japanese community

501c3 Tools• Bylaws• Certificate of Incorporation (EIN #)• Business Bank Account• Budget Documentation • NPO Filing Form• Physical Address not affiliated with any

individual or organization• Lawyer

– Guide through process– File paperwork

Steps to NPO

If you have bylaws, a certificate of incorporation, and a JETAA business bank account, your next steps are to:

1- form a small committee2- find a pro-bono lawyer

Reasons for Multiple Committee Members

• Time– Extra work to follow through with

lawyer and file documents– Added time to meet with committee

• Preserving Information– Passing info from leadership to

leadership– Reasons for past decisions

Lawyer Pros

• Pro Bono Lawyers – no cost / filing cost only

• Finding a lawyer– look in your alumni network for

connections• JETAANY lawyer is JET alumnus

– Contact local firms directly • Pro Bono lawyers are available by law

Lawyer Cons• Non-paying clients are low priority• All scheduling is subject to the

discretion of the lawyer• If they express willingness to move

forward, be flexible with time and accommodate the lawyer’s schedule

• Staff turnover – keep good notes!• Longer process than anticipated

Taxes• Taxes!

– Incorporated organizations required to file taxes regardless of income (GIA = income)

– IRS is likely not to go after an organization with income less than $10K

– 501c3 government will look at history• No filings = penalties• Imposed back-taxes for each year of no report• Important to follow tax laws regardless of

current or future status

Public vs. Private• Public vs. Private

– 2 versions of 501c3: public and private– Public is preferred by our lawyers – fewer

restrictions– Public = fewer restrictions, but 2/3 of funding

must be public• Government grant $ considered private• JETAANY did not want to solicit money from individual

donations or write proposals for grants• Solution: show that GIA is considered public funding

– Build community awareness about Japanese culture– $ not approved for food or drink budgets

• We have to generate 1/3 ourselves – seems like GIA counts against us. Unclear why.

State Laws

• State Laws– Depends on each individual state NPO

requirements– Don’t leave anything out required by

law• EG: Quorum requirement: amount of

participation required to make a meeting, motion, or vote official

– Lawyers will help to adapt bylaws early in the process

Voting & Elections

• Procedures for Voting and Elections– Depends on State

• New York– all election notifications / ballots must be sent to

all membership through the mail– Follow-up by email OK but initial announcement

by mail– 10% or 100 member response required (use

lower #)– Solution: Board of Directors chooses officers

Choosing Board Members• All 501c3’s require a Board of

Directors– Anywhere from 3 to 33 people (depending

on state requirements)– Appointment Flexible

• Make sure you follow state requirements and your bylaws

• Officers OK as Board Members– Officers can be board members, but the board

should consist of more than just the officers. – Officers decide the size of the board and invitations– JETAANY board is mainly former officers

Questions

Q&A

Questions not answered today will be posted by end of August.

Contact us:• Rob Tuck: president@jetaany.org• CJ Hoppel: treasurer@jetaany.org