If you have been following along, we have been conducting a series of posts on how to launch a 501(c)(3) nonprofit in California. Now that the Defending Equity Initiative has filed its Articles of Incorporation and is officially formed in California, we need to complete the initial filings with various key regulators to properly set up our new nonprofit. As the Managing Paralegal here at Mill Law Center, part of my job is to make sure all of the initial filings and registrations get done. The same goes for the nonprofit we just formed.

As the Managing Paralegal here at MLC, part of my job is to make sure all of the initial filings and registrations get done  – the same goes for the nonprofit we just formed.

A few disclaimers:

• Like with all of our other blog posts – this post is not intended as legal advice – we recommend that you work with a law firm or other experts if you can to launch a nonprofit.  These are just samples of how we work through some of these forms that you might use as a reference.

• These are the filings required for a California nonprofit that is only operating and soliciting charitable donations in California.  If you’re incorporated in a different state or operating in other states you probably have different filings to worry about.  California gives you a good idea of the type of forms states want, but every state is a little bit different.

Continuing our series of launching a new nonprofit, and our own work to launch Defending Equity Initiative (“DEI”), this post will cover the basic process for preparing and submitting a Form 1023, and how we thought through some of the key questions. This is often the part of 501(c)(3) formation that new charities are either intimidated by or blow past without enough spot, sometimes leading to complications down the road. And, in general, I do encourage new nonprofits to get legal support as they go through it because, as you’ll see, some of these questions feel a bit complicated or reflect concepts that new charities should really be educated on before jumping into the fray.

But sometimes organizations need to do it themselves, and this is at least one example of how to do it and a discussion of things to think about it. That’s not to say just take the 1023 we filed (copy here) and imitate it mindlessly. In fact, please do NOT do that — every submission is different and you are submitting this form under penalty of perjury. There are many things we said ‘no’ to that you should say ‘yes’ to and vice versa. But we submit a lot of these, and this is the approach we did when doing our own self-help, so hopefully you find it helpful.

We will have more posts in the future breaking down the Form 1023 into more pieces, tackling some of the questions that did not come up for this application, and providing more self-help resources. For now, we wanted to get this out now to commemorate this exciting step for our new nonprofit, and get the clock ticking on the IRS to respond and issue tax-exempt status so this organization will have an enhanced ability to support the charities under attack in the current environment.

In the spirit of the protests today, we think it is a great day to launch Defending Equity Initiative, a new freestanding nonprofit organization that will be a pro bono legal services provider for 501(c)(3) organizations unfairly targeted for their DEI programs, support of immigrants, or other progressive work. You can read more on its website about the kind of work it will take on and the organizations it will support. You can also see a couple of examples of the kind of resources we want to host there.

We’ll let that website and organization speak for itself, but here are some things you can do if you support the mission:

1. If you know an organization that is facing a live threat (an IRS audit, a lawsuit or other legal challenge), encourage them to apply for support. We can’t guarantee availability and can only offer pro bono legal services at this time to organizations facing active threats, but we want to hear what people are facing and will do what we can to provide or connect them to appropriate support.

2. If you have expertise that could be useful to an organization conducting diversity, equity, and inclusion programs or other race-conscious programming, that supports immigrants, or is otherwise progress and subject to targeting, please fill in our volunteer form. You’re not committed to anything by submitting, but we want to know who is out there and who we might be able to reach out if there are organizations in need of your expertise.

3. If you want to donate resources or handouts that make sense or have other ideas of you might be able to support DEI’s work, please email the organization.

Maybe after our 501(c)(3) application is submitted and received (more on that to come on this blog soon as part of this series) we may start asking for money so we can hire experts in addition to relying on volunteers, but for right now we are just looking for time and expertise from people as appalled as we are by the state of affairs, and the chilling effect radiating through the nonprofit sector, and who want to find some way to help.

As we launch Defending Equity Initiative, our new nonprofit for supporting progressive organizations that may be targeted by the current administration, it’s tempting to hit the accelerator and race through the formation process.  But we also want to use this series to model how to set up a nonprofit, and it’s all too common to see people over some important steps in establishing a foundation for a nonprofit corporation that will hopefully last a long time.

So, we’re going to try to be patient and use this post to cover everything after the Articles of Incorporation; namely, the Bylaws, the appointment of directors and officers, a Conflict of Interest Policy, and a framework for the nonprofit’s functioning moving forward. As a reminder and a disclaimer, these documents are provided as useful samples, not as legal advice, and every nonprofit corporation is a bit different — so, get legal support if you can when setting up your nonprofit and always read anything carefully that you sign and make sure it makes sense.

Once this is done, we can (finally) get to the work at hand, and with a solid legal foundation.

Continuing our series on nonprofit formation… we know why we are starting a nonprofit; we thought through whether we needed a new nonprofit, we decided how to structure the relationship to our for-profit entity; now... we form it.

This post will tackle the Articles of Incorporation, specifically for a California nonprofit public benefit corporation, using our new entity for organizations targeted for their DEI work as an example.  A document that is usually no longer than a page or so, many people do not realize that they are making a number of important choices when they file their Articles of Incorporation.  Choices that are not always easily unwound.

Let's walk through those together.

Continuing our blog’s series walking through how to launch a non-profit, we have already talked about what activated us to want to start a nonprofit  and whether it actually makes sense to start one – now, we’re going to start… with a detour (yes, this series is going to take a long time).

Like many people that come to us to form a nonprofit, we are not starting our plan from a blank canvas.  We have a for-profit law firm whose work could potentially overlap in personnel and subject matter with the 501(c)(3) nonprofit’s plan to provide legal and educational support to progressive charities targeted for their DEI efforts and social justice work.  We have a 501(c)(4) nonprofit that we use to carry out the charitable and advocacy missions of our employees – and the 501(c)(4) is allowed to do things that a 501(c)(3) is not. 

How do we make sure the 501(c)(3) nonprofit remains compliant and operates without integrity, while still leveraging support from our existing structure?

If you have or have considered a for-profit/non-profit affiliate relationship, this post is intended to illustrate how we work that question with clients (and ourselves). 

Following up on our last post, and with our firm continuing to feel frustrated about how we’re supposed to help, we started kicking around an idea.  If we think nonprofits should be open and defiant about their support of diversity, equity, and inclusion and if we think philanthropy should be putting up their resources to defend those that do, why not set up a nonprofit to gather and provide that support?   Provide our own expertise in terms of defending the exempt status of progressive organizations that are targeted, gather volunteers or use donations to hire experts to help with the things we have no business doing ourselves (immigration, civil rights litigation, criminal defense), and educate organizations in a way that pushes back on the fear campaign.

As transactional attorneys, we are not as useful as we’d sometimes like to be when it comes to times like these.  No one makes movies about tax lawyers, and they really shouldn’t.  The lawyers doing the most important work right now, and always, are the ones trying to keep people safe and out of cages.   

So, we’ll just have to settle for one of the handful of things we know how to do, which is set up a nonprofit.  And maybe we can help make it a little more meaningful by making it an educational exercise – using this blog to discuss and share documents for each step in the process in case people want to try it themselves.

Before committing to actually setting it up though, let’s ask the question that we try to get all of our prospective-charity-founder clients to ask:  is a new charity actually necessary?