From Fundraising to Allocation: Promoting Social Welfare

From Fundraising to Allocation: Promoting Social Welfare

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From Fundraising to Allocation: Promoting Social Welfare through Formation of a Non-Profit LLC

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“As we work to create light for others, we naturally light our own way.” ― Mary Anne Radmacher. As an aspiring social worker or someone who wishes to set up an organization that aims for societal good, integrating a non-profit Customer Relationship Management software or CRM can rock your fundraising results. Using a perfect CRM software, the data collection, planning, and communication with donors wouldn't be complex, as compared to the problems faced by traditional non-profit organizations. Registering as a non-profit can be done following several business structures, but setting up a Limited Liability Company (LLC) can be the best approach to promote social welfare objectives. The Internal Revenue Service (IRS) has specific tax rules for any organization registered as a non-profit LLC, which could be one of the following - public charities, churches, public hospitals, and educational institutions.

Forming a Non-Profit LLC: The Essential Conditions

While planning to register a non-profit LLC for the benefits it has to offer, an individual or group of people must fulfil a dozen conditions to ensure proper compliance with the guidelines laid down by the IRS. Having a charitable purpose and declaring it in the LLC operating agreement is the first step an individual could start with. Operating as a non-profit LLC restricts the motive of making a profit according to state laws, and hence is designed to focus on the social imbalances in the community. It also restricts the transfer of membership interest as specified in Section 501(c)(3). When starting a non-profit LLC, a comprehensive set of organizational documentation must be submitted to the state authorities to ensure compliance with the regulatory standards. Having developed a good understanding of the LLC laws, the next step is to identify the best state to start and operate a non-profit LLC.

Top 3 States To Form Non-Profit LLCs

Michigan - Leveraging the State Incentives


Whether you're planning to begin your charitable project or want to transform an existing social organization structure into a non-profit LLC, Michigan is one of the top places to consider during this process. While registering as a non-profit LLC, there are countless benefits that your organization can enjoy that include: the Community Ventures Program and tax exemptions. When planning the formation of a non-profit LLC, individuals must know the requirements to start an LLC in Michigan. One must file the articles of organization with the Michigan Department of Licensing and Regulatory Affairs. The state fee to be paid for the fulfillment of this mandatory step is $20, and a non-profit agent must be appointed to receive the services of the process. Having formed a non-profit LLC, you can avail of the benefits offered to facilitate social welfare practices.

Minnesota – Eradicating Poverty

Being a small state with a significant poverty rate ranging between 11% to 12% since financial shocks of the Global Recession in 2007, Minnesota is a perfect state to open a non-profit LLC to promote social welfare. When planning to set up a non-profit corporation, one must know about the requirements to start a non-profit LLC in Minnesota. This requires filing of the articles of organization with the Minnesota Secretary of the State. The cost of filing is $70. One must provide the following details: Non-profit LLC name, Incorporators, Name of Registered Agent, Employer Identification Number (EIN), and filing the articles of incorporation. Filing of the 501(c)(3) gets your non-profit organization tax exemptions according to the state laws. Looking to set up your organization for social work? Well, now you know which state to opt for!

Kentucky - LLC Formation at Low Cost

Kentucky’s non-profit organizations work on a much broader vision than just charitable acts, hence impacting the lives of countless individuals. With over 20,000 registered non-profits, Kentucky is the hub of non-profit LLCs and could be a great place to begin with creating the impact through social welfare that you’ve always dreamed of. The process requires filing of articles of incorporation with the Secretary of the State Kentucky; the cost of which is $8 which is another incentive to start your nonprofit with paying a hefty amount. After fulfilling the following requirements: obtaining an Employer Identification Number (EIN) and filing for the tax exemption status (501(c)(3)) your organization is one step away from starting operations. You just need the licensing and permits from regulatory authorities to begin impacting the lives of countless people. You might also want to connect with the Kentucky Nonprofit Network (KNN) to stay updated with the ongoing compliance and best practices. By doing so, one can ensure smooth operations of a social welfare foundation that is yet to impact the lives of an entire community.

By understanding the above-mentioned information, readers can start their own non-profit LLCs in their preferred states. If an organization is dedicated for a specific purpose, the founders’ dedication is a major contributor in achieving its goals. After all, dedicated individuals are the unsung heroes behind the efficient operations of nonprofits.

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