Legal
Find a lawyer
It will be helpful to get legal advice as you set up your organization. For example: the process of incorporating and filing as a nonprofit organization, setting up organization bylaws and staff policies, and deciding what kinds of insurance policies will best fit the Community ReUse Center.
Questions
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Do you have access to legal services through your network or those of your stakeholders?
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Are there resources in your community to help nonprofits get legal advice?"
Tips
Many law firms and universities offer pro-bono services at low or no cost to nonprofit organizations.
Finger Lakes ReUse's Story
We paid for an attorney who was expert in nonprofit issues. We worked with a private lawyer to file our Certificate of Incorporation and purposes with NYS, and with NYCON, the New York State Council of Nonprofits, on our tax exemption with the IRS.
Reserve an organization name with your state
Your organization needs an official name! The first step is to reserve the name you choose with the State. It costs very little to reserve a name, and the name must not already be used by another business in the state. The organization name may be different from what you call your Community ReUse Center. The brand of the organization will take a back seat to your public facing Community ReUse Center, so go ahead and be creative.
Tips
Check the name availability database before filing your paperwork.
Finger Lakes ReUse's Story
Finger Lakes ReUse was the name we decided on because we thought we would operate ReUse Centers throughout the Finger Lakes region. However, we realized that we have a lot of work right here in our County – we now have two Community ReUse Centers here, with a third being planned.
File for incorporation with your state
Next, you'll need to file for incorporation. Again, the costs are not high and you will receive an official "Certificate of Incorporation." We recommend you have legal assistance for this step, as the purposes listed in the certificate will be legally binding. You'll also need to fill out a form answering questions about your organization.
Tips
Read the guidelines provided by your state before you fill out the form; there is generally lots of helpful advice on questions you may have
File for IRS tax exemption
Tax exemption, or 501(c)(3) status, makes an organization eligible for grants and property and sales tax exemptions that are not open to private businesses. Material donations may be eligible as a tax deduction for the donor. NOTE: exemption from tax DOES NOT MEAN you are exempt from collecting sales tax from items that are sold in your Community ReUse Center. In New York State, such items must be taxed, the sales tax collected, and accordingly passed through to NYS where it is then redistributed, a portion of which comes back to local municipalities. (Another argument for a county’s return on investment!)
Tips
The 1023 form, Application for Recognition of Exemption (for nonprofits), may seem intimidating, but it is also an opportunity to develop a "best-practices" foundation for your nonprofit organization. Nonprofits must file a tax return with the IRS annually, so be sure to read through the 990 reporting form, which has questions you will want to be sure you can answer "yes" to, such as, "Does your organization have a Conflict of Interest Policy?"
File for a state tax exemption
IRS tax exemption does not make your organization exempt from state taxes -- you must separately apply with your state to be exempt from state taxes.
Establish your organization's bylaws
Your organization will need to adopt bylaws. Bylaws are rules that the organization must follow, such as how board meetings are run, how board officers are selected, how new policies are adopted or how old policies are updated, how grant money is distributed, and more.
Questions
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Are there any committees you want to make sure your board always has? How many board members should your organization have? If not everyone can make it to a meeting, will the board members who show up be able to make decisions without them? Will you allow virtual attendance for board members?
Tips
Keep the bylaws as general as possible. For example, rather than say the board will meet on the 3rd of every month, it's better to say that it will meet once per month. That way, if it's impossible for the meeting to be held on the 3rd, you won't break the rules by moving the date.
Acquire insurance
An organization or business needs insurance policies. For employees, you'll need workers compensation, unemployment, and short term disability. You'll also need general liability insurance. If you form you CRC as a nonprofit, it is recommended you have directors and officers insurance, which is usually quite affordable. You may also need other types of coverage such as automobile, property, flood and fire.