Easy Steps To Protect your Rhode Island Nonprofit and Keep Your Nonprofit Compliant

As with any other business, there may be risks involved in running the nonprofit. Getting insurance for your nonprofit allows you to focus on your passion while minimizing your liability.

Here are some of the common types of insurance you may want to consider for your organization:

• General Liability Coverage
• Directors and Officers Coverage
• Social Service Professional Coverage

Your coverage needs will vary based on your organization and the work you do.

There will be times when you will be signing a document on behalf of your nonprofit. It is important that these times are easily distinguishable from when you are signing a document as an individual. If a document isn’t properly signed, you might suddenly find yourself personally responsible for something the organization should have been liable for.

To avoid such confusion we recommend you and all the members of your organization follow the following format:

• The official name of your nonprofit
• Your signature
• Your full legal name
• Your position in the organization

Nonprofits that have incorporated are required to maintain a registered agent with an office address in Rhode Island. If the agent or the office address changes, you must file a Statement of Change with the Secretary of State to effect a change to the certificate of formation.

Between June 1st and June 30th of every year you must file Form 631 (annual report) with the Secretary of State. This can be filed online or submitted by mail to the address below:

Business Services Division
148 W. River Street, Ste. 1
Providence, RI 02904

Filing Fee: $20

For more information, you can call the Secretary of State's main line at (401) 222-3879, their business services information at (401) 222-3040, or visit them at their website.

The state of Rhode Island does not have a general business license.

It is best to contact the Department of Business and Regulation to check whether there are any particular licenses your organization will need.

Before your nonprofit can solicit for donations it must register with the Rhode Island Department of Business Securities Division. This can be completed online.

For more information, you can call the Business Regulation Securities Division at (401) 462-9527, fax them at (401) 462-9645, visit them at their website, or visit them at the office address found below:

State of Rhode Island
Department of Business Regulation Securities Division
Charitable Organization Section
1511 Pontiac Ave., Building 69-1
Cranston, RI 02920

Filing Fee: $90

NOTE: If your organization is a charitable trust you must register with the Rhode Island attorney general.

If your organization will have employees you must register for an income tax withholding account and an unemployment insurance account with the Division of Taxation using the combined online registration.

For more information, you can call the Division of Taxation at (401) 574-8829, visit them at their website, or visit them at the office address found below:

Rhode Island Division of Taxation
One Capitol Hill
Providence, RI 02908

All organizations that have been granted the 501(c)(3) status are required to disclose the following documents to the public when requested:

• Annual returns for 3 years after the due date (this includes returns like Form 990, 990-EZ, 990-PF, and any Forms 990-T)
• All Form 990 Schedules (except portions of Schedule B), attachments and supporting documents.
• Application of exemption and all supporting documents such as Form 1023
• The official paperwork from the IRS that shows that your organization has tax-exempt status.

The following do NOT need to be shared with the public

• Portions of schedule B of Form 990/990-EZ that identify the contributors. (You only need to disclose the amount contributed and the nature of the contributions)
• Any unfavorable rulings such as an earlier denial of tax-exempt status.
• Any information the IRS has said you can withhold. This may include things like sensitive patents and trade secrets.

FAQ:

How long do I have to produce these documents if requested?

Ideally within the same day. If your organization doesn’t have an office or maintains limited hours during parts of the year, the information should be made available within two weeks.

Do I need to provide copies of the documents?

If someone asks for copies in person or in writing you must provide them with copies.

Can I charge for copies?

You can charge a reasonable amount for making copies of the documents requested.

NOTE: It may be easiest to have the documents available on your website so that anyone who requests copies can be sent to the site. This allows you to stay compliant without having to spend a lot of time dealing with document requests.

Most tax-exempt nonprofit organizations are required to file an annual return with the IRS (Check the list of exceptions).

Which form you should use to file the annual returns depends on the annual gross receipt amounts for your organization.

"Gross receipt" is defined by the IRS as “the total amounts the organization received from all sources during its annual accounting period, without subtracting any costs or expenses”

• For gross receipts ≤$50,000 --- File 990-N
• Gross receipts <$200,000 and total assets <$500,000 --- File 990- EZ
• Gross receipts >$200,000 or Total assets >$500,000 --- File 990

For any questions, you can call the IRS at

• (800) 829-3676 (Form-related questions)
• (800) 829-1040 (General information)

When is form 990 due?

You have a little over 4 months after your taxable year comes to an end to file Form 990. It is due on the 15th day of the 5th month. So if your taxable year ends on Dec 31st, your form 990 is due on May 15th.

NOTE: If your organization fails to file form 990 for 3 consecutive years, it will automatically lose its tax-exempt status.

If your Rhode Island organization has a gross income of ≥$1000 from a trade or business that is not related to the stated purpose of the organization, then it must file Form 990-T to pay tax on that income.

IRS - Information for Charities & Nonprofits

IRS - Required Provisions for Organizing Documents

IRS - 990 Series for Tax-Exempt Organizations

IRS - Applying for Tax-Exempt Status

IRS - 501(c)(3) Compliance Guide

Small Business Administration - License and Permits

Rhode Island Department of Business and Regulation

Rhode Island - Business Registration

Rhode Island Secretary of State