Establishing a 501(c)(3) Organization in California
What is a nonprofit organization? Nonprofit 501(c) organizations are formed for one of three purposes: public benefit, religious purposes, or mutual benefit of its members (e.g. clubs and groups) [1] . Nonprofit means that no individual or private stakeholder can profit from the organization’s earnings [2] . That’s not to say that nonprofits cannot and do not make money, only that profits earned are used for the organization's benefit and operating expenses [1] . Nonprofits are also prohibited from making any attempts to influence legislation or be involved with any other political activity [2] . There are a number of 501(c) subsections, but this discussion will be focused on 501(c)(3) nonprofits. The Internal Revenue Service (IRS) refers to these as charitable organizations . Many formed for the purpose of environmentalism and/or conservation fall under this “public benefit” category. Under California law, this encompasses organizations formed for scientific, educational, lit...
