Online marketing Strategies For Nonprofit Organizations

Senin, 06 Februari 2017

steven shattuck: ...web seminar winning strategiesfor nonprofit compliance. and my name is steven shattuck. i'm the vp or marketing here atbloomerang, and i'll be moderating today's discussion. and today's i'm joined by annedavis-east, she's our guest today. hey, there, anne. thank for joining us. anne davis-east: thank you. steven shattuck: it's great for you to behere. and for those of you that don't do know anne, she is president of davis east consulting,where she consults in a suite of services for nonprofit organizations including establishment,dissolution, nonprofit compliance, united registration statements, and board development.she's authored numerous blogs and has presented

seminars and webinars on board development,state charity registration, profit compliance requirements, which is what we'll be talkingtoday. so, anne, thanks again for being here. it's going to be a lot of fun. anne davis-east: thanks for having me, andwelcome everyone. very quickly, i'm calling from the san francisco bay area, where we'reexpected 98 degrees and nice sunny warm weather. steven shattuck: now you made us all feeljealous. i'm here and india, and it's 50 degrees and raining. anne davis-east: i want to be sure everybodycan hear me. if you can just kind of punch in quick in your chat box a yes or a no, thatway i will know if all of you can hear.

steven shattuck: cool. anne davis-east: if you can never hear me,make sure that you type in and let steven know, and he will let me know if we're havingsome difficulties. so what i'm going to do is kind of get started today. we're goingto, an introduction, we're going to talk very briefly about operating a not-for-profit organization,and really mostly about kind of three duties that a board has. and then we're going togo into compliance issues, what you need, and then what will be ongoing filing. so we'regoing to jump to our board of directors, and as you can see, these boards obviously arefrom california. and on their way out to surf later on. so three kind of top duties of aboard are the duty of loyalty, a duty of care,

and a duty of obedience. and when i talk aboutthe duty of care, we're going to talk about that one first, i'm talking about using, diligence,care, and skill with people who have a similar circumstance. so this is really about yourboard. also, we're going to make sure that they're familiar with the organization's financesand activities, and they have participated in governance. so they attend those boardmeetings, they're actively engaged. they're also going to make sure that they read thematerials and the minutes to make sure that they are up to date. they're going to reviewall their financial statements, and that includes, and we'll get down to it a little bit more,reading the 990 filing documents that the organization files every year. they're goingto know what the written policies and controls

are of the organization. and then we're goingto get into duty of loyalty, and that is that they need to be aware of the conflict of interestpolicy, that they're...are we having, steven, are we having problems with people still hearingme or is it okay? steven shattuck: anne, i can hear just fine.why don't just keep going, and i'll try to work through some of those issues in the chat,okay? anne davis-east: okay. great. thank you. they'realso going to know that they're there for the organization and not for their personalgain. and then we're going to go into obedience. duty of obedience to ensure that the organizationcomplies with all applicable laws and has its own internal documents and policies. alwaysremember that one of your kind of issues is

that all of your board minutes and your bylawsand your policies are open to the public. so anyone can come in and ask for those. soi have some clients who will keep their board notebook, their minute book, at the secretary'shome. it really needs to be at your organization, not in someone's home, someone's garage. let'ssee. you're going [inaudible 05:28] you give all of your board members your tax exemptforms, your federal reports, your financial reports, anything that is really needed tokeep them up to date. okay. let's go onto our compliance issues. and so we have herecompliance carl, and he's in charge or making sure everybody is taken care of. so the firstthing in this issue is your filing with your secretary of state. and the majority of states,that is where you go to to form your nonprofit

at the state level. for example, here in californiayou go to the secretary of state. a nonprofit is considered a corporation, so you file asa corporation. and that is really where you want to start. in some states, and again,probably in most states, you will have an annual filing, which we'll talk about in alittle bit. the second one is your attorney general. you attorney general is the one whoreceives all the complaints about nonprofits. and again, you will have to register withthem. it's kind of a short, usually two to three page, document you can pull up fromthe website. then you're going to talk to what, here in california, is called the franchisetax board, but in only other states it's referred to as the department of revenue, and that'swhere you send off so you can become nonprofit

and have tax-exempt status within the state.and that way you don't have to pay your taxes. here in california, that means you are exemptfrom an $800 a year late fee. and then make sure that you are in compliance with whichis referred to as the unified solicitation. and what that is filing in all states so youcan fundraise. and fundraise includes not just your annual appeal letter that you maysend to somebody, but if you have a donate button on your website. that leads to thosestates to know that your fundraising within those states. so again you might want to lookand see if you have any out of state donors and how much you gain from them. it's nota complicated process to be registered in all the states. it's just very time consumingwith the paperwork. and again, you also have

to learn if it's a one-year or a two-yearrenewal. and also, in your compliance, is that you need to be aware of your unrelatedbusiness tax. so if you sell anything that is not tied into your mission, an examplewould be a biotech lab here sold snacks and sodas, water to their members. that is notpart of their mission, so that is considered unrelated business tax, and they pay tax onthat. so again, you might want to check your states and see what is unrelated businesstax and what you need to do with that. and also, employment. you have unemployment benefitsthat you may be responsible for. you may have to pay quarterly taxes or estimated taxesfor your employees. so those are other things that you need to take care of. the last onethat i would kind of really look into is that

some states now and some districts, countiesin states, ask you to register the police department, and that is to oversee any scammingthat's going on. so if you send out appeal letters, you may need to register and geta permit number for those type of things. it sounds like a lot of paperwork and filing,but once you do it the first time and you start doing renewals, it just really fallsinto place. and everything is now becoming where you can do online, which is very helpful.probably another thing that you need to look into is your fictitious name in your communityand if you need a business license. and depending on what your organization does, you may alsofall under osha or environmental protection requirements. i'll use again this biotechnology,here in my area, they run experiments, so

they have to have a permit from the environmentalprotection, and osha has to come in, along with the fire department, and make sure thatthey're set up and following all of their guidelines. so there we are. next one is,this is just a little cartoon, this woman remember that she donated, but she's not realsure how she has saved the children. this is not really a compliance, really what itis is just to remind you to always let you know donors' money is being used. sort ofjust a reminder, thank you, keep us in mind, and here's what your dollars went to. steven,do we have any questions right now? steven shattuck: not yet, but i just encouragedsome folks to be thinking and sending those your way. so we'll see what comes in.

anne davis-east: okay. great. so here areyour ongoing reporting requirements. and as i said, secretary of state, a yearly or biannualfiling. i'm going to use california as our example going forward now. so every year orbiannually, nonprofit will file what is called a statement of information. that statementof information has a filing fee, of course, but what's is going to ask, it's going toask have there been any changes. so has your registered agent, who is the person that receivesall your information, all the state filing information reminders, if somebody for someawful reason decides to sue you or makes a complain to the attorney general, that personis the person who receives all of those mailings. so, as i said, the statement of informationis going to ask if there's any updates. it's

going to ask if you have a new mailing address.it's going to ask for your board members and what the officers are. and i think that'spretty much what they ask for. with the state's attorney general, again here in californiayou file a return, and that return is going to ask pretty much the same thing about yourboard, change of address, any of that, but it's also going to ask you what your activitieswere during the year to show that you are still doing what your original mission statementis. it may ask for some financials. also, here in california, prior to the 30th of augustevery year, you need to send in if you're going to be holding any type of raffle. becauseas you know you need to file raffle reports prior and after you hold your raffle. so they'llask for that. the department of revenue, here

in california, it's the franchise tax board,they will ask to see mostly your financials. so, again, you will be filing what is calleda 199, which is our state tax return for a nonprofit. and we'll go from there. i alsowant to let you know that both the secretary, the attorney general, and your departmentof revenue, donors can go to the website and search for your nonprofit, and they can findif you are in compliance. an example would be with the secretary of state, there is anorganization that has not filed their statement of information, when you pull it up, it showsthat they are suspended, which means, in california, they cannot accept donations. with our franchisetax board, you can also search to see if they're nonexempt. if they're exempt, i'm sorry, ifthey're exempt, it'll show that and also as

for whether to show that. with the irs, obviously,we all know it's our 990s, that we need to constantly bring up to date. luckily, thereare some, the 990-ez should shortly be available online, so you can file that way. but it'sreally important that you keep up with irs regulations. they are always changing thefinancial threshold of what type of 990 you need to file. they'll also be requiring newtypes of information. on the current 990 it will ask you do you have a conflict of interestpolicy. it will ask you if you have a whistleblower policy. it'll ask you if you have a documentretention and destruction policy. and they'll ask you if you have a joint venture policy.so these are all things now that the irs requires that nonprofits have. and a lot of it youcan go straight to. so, steven, do we have

any questions? steven shattuck: yeah. we've got a few here.it looks like some of the tax things you were talking about got some ideas for questionshere. daniel, in the chat room, was wondering if you have a tax return and a 990 form. couldyou maybe talk a little bit about what forms specifically you do need to send in? anne davis-east: sure. with the irs, daniel,you file your 990, and that is your tax return. some people really will say it's not a typicaltax return because you're exempt. it's more of an informational return. so depending onwhere you fall in your gross receipts will determine if it's a 990-ez, which is the postcard,a 990-n, or your full 990. and again, i would

recommend going to the irs website, whichis irs.gov. when you get there you can search for charities up in the search box, and thenyou can ask a question, and it also has a wealth of information. you can also check,hit select check, and you can put in your nonprofit, and it will tell you if you'restill registering with the irs. we've had some issues, as you know, that nonprofitshave not filed their 990 returns for three consecutive years, and their status has beenrevoked. so this is kind of a good way to double check that you are all in compliance.any other questions? steven shattuck: yeah. they're starting tocome in, anne, which is great. thanks to everyone for being a good sport about asking questions.one here from chris. chris says, "if our nonprofit

organization holds a golf outing to raisefunds for our mission, do you have to pay taxes on what was raised, since golf isn'treally part of their mission?" what's the protocol there on those funds from a golfouting or a similar event? anne davis-east: those are considered, actually,part of your mission. that's how you fundraise, so that's considered a special event. if yousell anything, again that's not, like your mugs or a hat or any of those things, thatcould be considered an unrelated business tax. i would suggest that you talk with yourcpa, your accountant, or go directly to your department of revenue within your state andask them. you also will need to check the irs to make sure, and again your accountant,cpa, that if you hold an account there on

occasion, well, not on occasions, but anythingthat goes above the estimated value sometimes is considered income to the winner, so youmay have issue a form to them, and they would be responsible for paying taxes. one otherthing that i mention is that a lot of your state, like from your franchise tax board,or your comptroller, any of those, give free workshops and seminars both online and inperson around these accounting issues. so you may want to go to their websites and lookup and see if there's one close by. if there isn't one, you can always have them come toyou, and as a good community outreach, invite other nonprofits to come and hear what theyhave to say. so always remember that your state and the irs is there to help you, notto just constantly get on you for not doing

something right. okay. next question. steven shattuck: yeah. you're on a roll. we'vegot some good ones here, anne. i hope you took your vitamins this morning. anne davis-east: yeah. yeah. steven shattuck: daphne here is asking aboutjoint venture policies. you mentioned that a little earlier. could you explain and talka little bit more about what that is? anne davis-east: yes. a joint venture policywould be if you joined, say mcdonald's, and you were going to do a fundraiser with mcdonald's.that's a joint venture activity, and so the policy would say how the funds are divided,who is going to do the advertising, it just

spells out what the partnership is going tobe like. again, steven, i don't know what the follow up procedure is, but i can alwayssend you examples of joint venture policies that you can offer to the participants. steven shattuck: sure. anne davis-east. which would be, and we coulddo the same with the whistleblower and the document destruction and retention. steven shattuck: okay. yeah. and we'll definitelyshare your contact info to everyone so they can get a hold of you if we miss anything,for sure. all right. great. anne davis-east: okay. okay.

steven shattuck: here's one from christine.christine asks, "is there a timeline when possibly all states will accept the urs form?"any insights on that? maybe you could talk a little bit about what that form is for peoplewho are unaware. anne davis-east: right. what that form is,again, is to allow you to fundraise in any state, mostly out of your state. so what wewould recommend, there is a book that talks about fundraising registration in the 50 states.it's from nolo press, which is very good. every state has their own way. there's a unified,which some states take. and then other states, you have to send in additional paperwork,which you have to pull up from their website. our company does those filings for you andthen keeps you up to date when you have to

refile. again, it's not a lot of work, justvery cumbersome getting all the materials together. and the nolo book goes through eachstate and tells you what is needed, what they accept, and what they don't accept. again,if you have a specific question or you're looking into doing it, please get in touchwith us, and we can walk through with you. steven shattuck: cool. all right. we've gotone from jackie here. jackie's wondering, "if you miss an official deadline for statefiling by two months, should you wait until next year or should you try and go ahead anddo it that year?" anne davis-east: i would go ahead and fileeven if you're two months. again, here in california, which is my example, if you don'tfile with the secretary of state, say your

statement of information, as i said, it'sa $25 filing fee, the state will send you a letter and will inform you that your $25filing fee is now a $250 fee. and the longer you don't bring it up to date, they will suspendyou. so i would, even if it's two, three months behind, i'd go ahead and send it in. steven shattuck: okay. yeah. send that in,jackie. don't wait. great. we've got some more here, anne, if you're up for it. anne davis-east: sure. steven shattuck: pamela, was wondering, pamelais using a fiscal agent until their 501(c)(3) is finalized, and she wondering if she holdsa raffle, is she going to need permits if

it's held in conjunction with someone else'sevent. so it looks like they're partnering with someone else until their 501(c)(3) isfinalized. is she going to still need the permits there. anne davis-east: she is still going to needthe permits. and i would suggest that she speak with her fiscal agent to see if thefiscal agent is the one who wants to file the permit or if they want her organizationto. steven shattuck: okay. great. we've got another... anne davis-east: and i would... steven shattuck: oh, go ahead.

anne davis-east: one more thing is, with yourfiscal agent, we highly recommend that you have a contract of an agreement with themthat again spells out what they will be responsible for and what you will be responsible for.and that goes from their administration fees, do they divide the bank and interest or whateverbetween the two of you, but also how long they're going to be your fiscal agent. a lotof organizations use it in their interim, but then they find that they're fundraising,they raise quite a bit of dollars, but they're really not getting those dollars back to them.so i would just really make sure then everything is written out. steven shattuck: cool. great advice. well,chris here has another question about 990s.

chris says he knows that form 990 asked, aboutwhether you have assorted policies, but does the 990-ez also ask about those? follow upquestion is what if you don't have those policies written up? what should you do with the ezform? anne davis-east: the ez form, what it is isreally just asking if you have those policies, and i don't believe your asked that on theez form. you're asked it on the long form. but it's highly recommended that the boardlook into having those policies. it's good governance. it's a best practice. and in thelong run it'll save a lot of aggravation if somebody comes and asks for a document, andyou just destroyed it, but you were supposed to keep it for seven years. so i would justgo ahead and get those policies in place.

steven shattuck: cool. great. we've got aquestion here from debbie, and debbie was wondering about auction items purchased overtheir value. is there a resource you could share or any advice about how to with thatissues and what those require? anne davis-east: i do, and if kelly, is itkelly that asked that question? i'm sorry. steven shattuck: it was debbie. anne davis-east: it was debbie. i'm sorry.if debbie wants to get in touch with us, we're happy to send her some resources that willexplain how auction are handled. steven shattuck: okay. cool. anne davis-east: generally, the rule is isthat if it goes above what the item was valued

at, it's considered income. and also, anotherlittle hint is whoever donates the auction item, they don't get the value of the item,you do. steven shattuck: right. okay. great. anne davis-east: so, yeah. so if she wantsto send us a quick email, we're happy to send her some stuff. steven shattuck: kelly here was wonderingwhat the pros and cons are of hiring a company to do the paperwork for you. do you have anytips on choosing a vendor for that or outsourcing that in general? anne davis-east: we get that question allthe time. the first thing is we always say

if you're starting a new nonprofit, the irsestimates that is takes 200 hours to fill out the paperwork for form 1023. so if youhave 200 hours of your time to fill that out, that's wonderful. if not, sending it out tosomeone else who has done quite a few of them and knows the ends and outs and has directcontact with the irs to ask for information, that is well worth the expense. and actuallyfor anything. your state filings are fairly simple. i would say anything that deals withthe irs, if it's a unified registration, any of those type of things, or initially registeringwithin another state, i would really look at outsourcing. they understand what the paperworkis, what's entailed, know where to go to get the information. and again, we always recommendthat you take whatever your hourly rate is

times how many hours it's going to take youto fill it out. if it's within reason, go ahead and do it then if you have time, otherwisetalk to somebody. and we do all sorts of ways of filing forms for people. so again, it'sjust like hiring another consultant. if you bring in a consultant to do strategic planningfor your organization, you use the same criteria. steven shattuck: a question that kind of dovetailsout of that. she's wondering is there a difference between hiring an instate company versus anout of state company to do all that for you. does it matter? are there any special considerationsyou use there? do you have to work with someone in state? anne davis-east: no. we've done filings inall 50 states, and we also have clients in

mexico and canada. so we work with everyone.i would say if you're going to hire someone to come in and raise funds for you, and they'reout of state, that fundraiser needs be registered in their home state, but they may also haveto be registered in your state. so you may want to see if that fundraiser is registered. steven shattuck: great. we've got a questionhere from tom, a question about the 990-ez form. what are the cutoff requirements requiredfor staying within that form? i think he's asking there about the differences. anne davis-east: right. so it's, when you'refirst filing, they just changed it. so i can't answer that question off the top of my head.i'm going to have my assistant pull that information,

and we'll get right back to it. steven shattuck: ok. cool. well, anne, i thinkwe exhausted all the comments in the chat room. i know we went a little over time. wesaid we'd do about an hour half. anne davis-east: right. steven shattuck: so i'm going to give peoplea little bit of a last chance to send any questions. while we do that, anne, i'm goingto put your contact info on the screen here. could you talk a little bit about how folkscan get in touch with you and what kind of things you offer? anne davis-east: sure. so you can give usa call. again, we're on the west coast, and

you will see our phone number up on the screen.you can also send me an email at daviseastconsulting@gmail.com. we are also on facebook. we have a businesspage, davis east consulting, so please go ahead and like the page. and we post new thingsevery single day. and what davis east does is we work with nonprofits in all their filingdocuments. so we help you establish your nonprofit. if for some reason you have to dissolve, wewill do your dissolution paperwork. we also write your bylaws, we'll help update yourbylaws. we write all of the policies that i spoke about. we also do ethical trainingto make sure that you're working ethically with your organization and your board. soanything that has to do with compliance, to keep you legal, that is what we do. we dopartner with a couple of attorneys and cpa

accountants so we're kept abreast with thingsthat are coming out from their end, and if we have any legal issues, we'll talk to them.so that's what we do. we're here for anything that you need. if you have just a quick question,please feel free to get in touch with us. we're happy to help you and answer that question.so thank you and thank you all for the questions, and we look forward to hearing from you. steven shattuck: you got time for a couplemore, anne? anne davis-east: i'm sorry. steven shattuck: anne, do you have time fora couple more questions? anne davis-east: of course i do. i have acouple more.

steven shattuck: okay. yeah, we got a couplehere from daniel, and i want to ask them for him since he was a good sport about sendingus some other questions. anne davis-east: okay. steven shattuck: daniel was wondering, "howlong does it take to get a response to a 1023 application form?" looks like he's maybe waitingon that and not sure how long that'll take. anne davis-east: daniel, that's always a greatquestion. according to our contacts, it can be anywhere up to 12 months to 18 months.but they do want you to know that you can fundraise in good faith, and as soon as yourpaperwork was filed and you received a letter that said they have received, which generallytakes maybe 90 days at the most. you just

make sure that you let you donors and yourcorporate partners know that it's pending, and if there's any problems or you were notaccepting, that you will let them know. but in the meantime the irs will let you fundraisein good faith. and i will say, daniel, the other thing is that the irs has three pilesof their paperwork that comes in. one pile is that they have absolutely every singlething that is required for them, the addition on your 1023 financial statement is [inaudible38:19]. that goes through at a quicker pace, obviously, than if you're missing anything.so if at any time, if you're doing a 1023 and you would like us to review, we're happyto review that and let you know if you're missing anything. we always want you to bein that first pile.

steven shattuck: right. elaine was wonderingif you knew how long it takes for them to respond once they've called. so once theycall and ask questions, how long does it usually take from that standpoint? do you have anyidea there? anne davis-east: i don't have any idea. again,it goes into a pile and is assigned. what you can do is look at the irs website, andyou can search to see where your application is in the process. and that should give hera little bit more idea of how long it will take. steven shattuck: okay. cool. jackie here waswondering, "what do nonprofits usually get audited for?" what are common reasons thata nonprofit gets audited for?

anne davis-east: so if the financials increasedramatically from one year to another, if the compensation to your board members orto your executive director again increases or is incredibly high, if you are the boardchair, secretary, and treasurer, so those are kind of the big ones, kind of the redflags that they'll look for. and they'll also, you the 990, now, is more of a storytelling,so if you look at your activities, and again, they'll see if it's aligned with your mission. steven shattuck: okay. cool. one questionhere from ira. ira's wondering, "if an organization has no income and no expenses during the taxyear after they incorporated, do they have to report any expenses and payments priorto the incorporation?"

anne davis-east: not as a nonprofit. you wouldhave to check with your state to see if they considered you a for profit corporation, andif that was the case, then you may have back taxes as a corporation. steven shattuck: okay. anne davis-east: but if you continue not tohave expenses or income as a nonprofit, you still should file your 990-n, which is thepostcard because the irs will look at you, you're considered a nonprofit, you didn'tfile, and they give you three years, and they'll revoke your status. steven shattuck: okay. daniel was wondering,"what do you have to do to update or amend

you bylaws?" are there any compliance thingsthat you need to worry about there with regard to updating your bylaws? anne davis-east: no. the bylaws is your internalpiece on how you're going to govern. so you can change your bylaws, amend your bylawsat any time. what you really follow is robert's rules of order on how to make motions andthose type of things. but you should always look at your bylaws at least every three yearsto see if that's still how you want to run your organization, the board. a lot of bylawsdon't reflect all this new technology that we have of smartphones and electronic votingand those kinds of things. so you may want to look and update your bylaws to reflectthat.

steven shattuck: okay. great. well, mary hada question that had to do with that. mary's organization sounds like they're going tochange their entire mission and not just the bylaws. is there anything to do there or doesthat just kind of fall into the same boat? anne davis-east: it falls under the same boat,but i would also, when you do your 990 and all your other state filings, that you informthem of your new mission, and your mission was also part of your articles of incorporation,so you may want to check to see what your state requires you to do for that. steven shattuck: okay. great. well, i knowyou've answered a lot of questions, and you were definitely a good sport about it, anne.is it a fair statement to say that folks can

contact you with any further questions ifwe didn't get to them? would that be okay? anne davis-east: yes. they certainly can,and we look forward to their questions. steven shattuck: well, good. this was a lotof fun. it's been a while since we did a mostly q&a webinar, but i think that you gave greatanswers to everyone's questions, so thanks for hanging out with us for about an hourand sharing all your knowledge. it was a lot of fun. anne davis-east: oh, well, thank you, steven.it was good. i'm looking for to taking some of your upcoming topics as well. steven shattuck: yeah. and just so everyoneknows, we do do these webinars once a week.

they're totally free to register, totallyeducational. we've got some good ones coming up. we've got a great one coming up in june.katie miller is going to join us to talk about infographics and videos. definitely checkthat one out. i kind of highlighted that one because it's kind of an exciting topic. we'regoing to talk about getting your board to fundraise a little later on this month. socheck out our webinar page. register for anything that you might find interesting there. again,totally free and total educational. so check those out. just so everyone knows, i willbe sending out a full recording of today's presentation along with anne's slides a littlelater on this afternoon. so look for those to hit your inbox in just a few hours here.so with that, i'll let you all get back to

your day, maybe get to lunch. so thanks againfor hanging out with us, and we will talk to you next. so bye now.