There are countless organizations and charities already in existence, but there is always a need for a spotlight to be focused on another and it takes a very special person to shine that light. Choosing to take the initiative to even consider forming a non-profit organization is an admirable task. If this is something you’ve considered, perhaps the following information might help you decide if it’s really something you’re ready to do.

First of all, what is a non-profit organization (NPO)? Stated plainly, it’s an organization that uses surplus revenues for the goals in which it was formed to achieve, rather than distributing profits. Some NPOs may have paid staff or management, while others run on volunteer strength alone. To be considered a non profit and be deemed eligible for tax exempt status by the Internal Revenue Service, an NPO must qualify under the 501c code; but we’ll get to that fun IRS stuff later.

There are two major types of NPOs; membership organizations and those with a board only. In the case of membership, generally a board is elected; the organization holds regular meetings and has power to amend the by-laws established for the organization. With a board only organization, often the board is self elected and membership powers are limited to those delegated by that board. (wikipedia.com)

Still thinking about starting an NPO? Best advice – do your research and see what, if any, organizations already exist for your cause. If there are already some going strong, it may be more beneficial to work with them than reinvent the wheel. If there is a need, do your homework. You need to determine the feasibility of starting your organization. Consider the current economic climate and what your funding needs may be. You’ll need to develop a mission statement, create an organizational structure and draft a three year budget. This needs to encompass your marketing plan, any salaries you’d need to pay and other resources as well as fundraising plans. You will also want to include volunteer needs and possible community partnerships in your business plan.

I promised we’d get back to that super exciting IRS stuff – here we go…There will be a bit of paperwork to fill out, most importantly filing for tax exempt, 501(c) status, with the IRS. This is an integral component of any NPO. It is highly recommended that you seek out qualified assistance when forming an NPO. This isn’t a time to ask Mom for advice, unless Mom is an attorney with experience dealing with 501(c), non-profit organizations. Legal counsel with this kind of experience will be an invaluable asset to you if you are considering organizing a new non-profit organization and will save you a lot of headaches along the way.

Now, you have your plan and your paperwork –what’s next? Honestly, it’s time to think about implementation. How can you create and sustain this organization? This really goes back to your business plan. If you think that you can achieve your goals of offering reliable, sustained services to your chosen beneficiaries (basically you can open your doors and keep them open) in less than three years; it may be best to be housed within an existing organization. It’s something called "fiscal sponsorship" in which one organization shares their tax exempt status with another. (National Council of Non Profits) In some cases, being "sponsored" by an existing tax exempt organization allows for better success.

Of course, filing with the IRS and determining the best funding avenues for your NPO isn’t the only paperwork you’ll have to complete. There are numerous State and Federal forms that must be legally filed to get your non-profit up and running. There are many resources that can assist with this, including www.lawforchange.org. Here you’ll find advice from local professional advisors on starting a non-profit, managing your organization and fundraising. If all that IRS stuff has your eye twitching already, rest assured they do try and help in any way they can, including providing fee webinars on tax exempt filing and other helpful information at www.irs.gov/charities/. Locally, you can find information on starting a non-profit by contacting the Colorado Non-Profit Association at 303-832-5710 or www.coloradononprofits.org.

Don’t let this overwhelm you. If you are considering sticking your neck out to start a badly needed NPO, more power to you. Volunteers and those who are passionate for their chosen causes make the world a better place. The biggest and best non-profit organizations were once the ideas of someone just like you. After all, Paul Newman stuck his likeness on some salad dressing bottles and, years later, millions and millions of dollars have been raised for charity. What simple yet sensational idea are you ready to unveil?