Tax Exempt Entities - The Law Office of Dustin Whittenburg

Formation

Forming a tax-exempt entity involves several steps that must be taken in accordance with the regulations set forth by the Internal Revenue Service (IRS). Here are some general steps to consider when forming a tax-exempt entity:

Choose the type of tax-exempt entity: The IRS recognizes several types of tax-exempt entities, including charitable organizations, religious organizations, educational organizations, and social welfare organizations. The type of entity will determine the tax-exempt status and the reporting requirements.
Draft the articles of incorporation or organization: The articles of incorporation or organization are legal documents that establish the existence and purpose of the tax-exempt entity. The articles must contain certain language required by the IRS, such as a statement of the organization’s exempt purposes and a dissolution clause.
Draft bylaws and other organizational documents: Bylaws are an important document for a nonprofit organization as they establish the framework for the organization’s internal operations and ensure compliance with state and federal laws. Bylaws can help prevent conflicts, promote accountability, and provide a foundation for the organization’s long-term success. Bylaws can be an important tool for protecting r organizations by providing a framework for governance and establishing the legal rights and responsibilities of the organization’s leadership and members. Without the proper language, an organization’s mission and principles can be legally challenged.
File for tax-exempt status: To obtain tax-exempt status, the organization must file an application with the IRS using Form 1023 or 1023-EZ. The application requires detailed information about the organization, including its mission, activities, and financial information.
Obtain any necessary state-level tax exemptions: Some states offer tax exemptions for charitable or nonprofit organizations, so it may be necessary to file additional forms with the state government to receive these exemptions.
Establish governance and financial policies: The organization must establish policies and procedures for governance, such as a board of directors, and financial management, such as an accounting system and record-keeping procedures.
Maintain tax-exempt status: To maintain tax-exempt status, the organization must meet ongoing reporting and record-keeping requirements, such as filing an annual Form 990 with the IRS and keeping accurate financial records.

Forming a tax-exempt entity can be a complex process, and it’s important to seek the advice of legal and financial professionals who can guide you through the process and ensure compliance with all legal and regulatory requirements.

Operations and Management

Nonprofit management involves overseeing and leading the day-to-day operations of a nonprofit organization to achieve its mission and goals. The team at The Law Office of Dustin Whittenburg has successfully run local, state, and national nonprifot organizations in 16 states in our great nation. It’s one thing to know about nonprofit operations, it’s another to have successfully done it!

Here are some key areas of nonprofit management:

Strategic planning: Developing and implementing a strategic plan that outlines the organization’s mission, vision, and goals is a critical aspect of nonprofit management. This involves setting priorities, establishing objectives, and developing a plan for achieving those objectives.
Fundraising and resource development: Nonprofits rely on donations, grants, and other sources of funding to sustain their operations. Nonprofit managers are responsible for developing and executing fundraising strategies, applying for grants, and cultivating relationships with donors and funders.
Financial management: Nonprofits must manage their finances carefully to ensure long-term sustainability. This involves developing and monitoring budgets, managing cash flow, overseeing financial reporting, and ensuring compliance with financial regulations.
Program development and management: Nonprofit managers are responsible for developing programs and services that align with the organization’s mission and goals. This involves identifying needs, developing programs, managing staff and volunteers, and measuring program outcomes.
Board and volunteer management: Nonprofit managers are responsible for working with the board of directors and managing volunteers. This involves recruiting, training, and supervising volunteers and board members, and developing policies and procedures to ensure effective governance and management.
Public relations and marketing: Nonprofit managers must promote the organization and its mission to the public. This involves developing marketing strategies, managing social media, and building relationships with the media and other stakeholders.
Legal and regulatory compliance: Nonprofits are subject to a variety of legal and regulatory requirements, including tax laws, employment laws, and reporting requirements. Nonprofit managers must ensure compliance with all relevant laws and regulations.

Tax-Exempt Funding

Nonprofit organizations turn to The Law Office of Dustin Whittenburg when interested in receiving tax-exempt funding or tax-exempt bonds because these types of funding come with certain legal and regulatory requirements that require highly specialized legal expertise.

Here are a few reasons why a bond attorney might be necessary:

Compliance with IRS regulations: To receive tax-exempt financing or a tax-exempt bond, nonprofit organizations must comply with IRS regulations that are specific to tax-exempt financing. A bond attorney can help ensure that the organization is in compliance with these regulations, which can include rules around the use of proceeds, restrictions on the private use of bond-financed facilities, and limitations on arbitrage.
Drafting legal documents: Tax-exempt financing often requires the preparation of legal documents, including offering documents, bond documents, and other legal agreements. A bond attorney can assist with drafting and reviewing these documents to ensure that they comply with relevant legal requirements and protect the interests of the nonprofit organization.
Negotiating with bond underwriters: Bond underwriters may require negotiations to structure the bond issuance and to obtain favorable terms and conditions for the nonprofit organization. A bond attorney can negotiate on behalf of the nonprofit organization to secure favorable terms and conditions for the bond issuance.
Managing ongoing compliance: After the bond issuance, nonprofit organizations must comply with ongoing regulatory requirements, including record-keeping and reporting. A bond attorney can help ensure that the nonprofit organization remains in compliance with these requirements, and can assist with responding to inquiries or audits from regulators.

Give The Law Office of Dustin Whittenburg a call today to help your nonprofit organizations navigate the complex legal and regulatory requirements associated with tax-exempt financing or tax-exempt bonds. They can assist with ensuring compliance with regulations, drafting legal documents, negotiating with bond underwriters, and managing ongoing compliance.

Bond Opinions

Dustin Whittenburg is a trusted expert when organizations are looking for an “opinion” related to tax-exempt bonds. He is hired to provide a legal opinion on the tax-exempt status of the bonds. The purpose of the opinion is to provide assurance to the bond purchasers and underwriters that the bonds are in compliance with the federal tax laws and regulations related to tax-exempt bonds.

A tax-exempt bond is a type of bond issued by a state or local government or a qualified nonprofit organization to finance public infrastructure projects, such as roads, schools, hospitals, or affordable housing. The interest on tax-exempt bonds is generally exempt from federal income tax, which makes them attractive to investors seeking to reduce their tax liability.

To ensure compliance with federal tax laws and regulations, Dustin Whittenburg is engaged to provide a legal opinion to the bond purchasers and underwriters. The legal opinion generally covers two main areas:

The validity of the bonds: The opinion will typically confirm that the bonds are validly issued and that they comply with all relevant legal requirements.
The tax-exempt status of the bonds: The opinion will also confirm that the interest on the bonds is exempt from federal income tax, as long as the bonds are used for the intended public purposes and the issuer complies with all relevant federal tax laws and regulations.

The opinion is a crucial component of the bond issuance process, as it provides comfort to bond purchasers and underwriters that the bonds are in compliance with all legal and regulatory requirements. This, in turn, helps to ensure that the bond issuance proceeds smoothly and that the bonds are successfully sold to investors.

Over Two Decades of Success

The highest level of peer rating.

The nonprofit team at The Law Office of Dustin Whittenburg has over two decades of success counseling non-profit organizations and creating and managing daily operations. His team has launched and successfully run local, state, and national non-profit organizations.

Dustin Whittenburg is a member of the National Association of Bond Lawyers (NABL), a specialty bar association of approximately 2,500 lawyers from the top law firms in the country. NABL represents issuers, non-profit institutions, and other participants in public finance transactions.

Whittenburg has also received the top rating by Martindale-Hubbell. The Martindale-Hubbell Peer Review Ratings have been in existence for over 140 years. They provide a way for attorneys to be rated by their peers on their legal and ethical ability. Martindale-Hubbell peer review ratings are the gold standard in attorney ratings.