Regular work of a non-profit can not be negligent. California requires filings for registrations, exemptions, licenses, and permits. The filings begin after the non-profit is recorded with the Secretary of State (SOS).
Registration for Unincorporated Non-Profit Association
A non-profit that does not incorporate with the SOS has to file a Registration of Unincorporated Nonprofit Association form with the SOS for a $10 fee. The form includes association name, address, and insignia.
Registration with Attorney General
Thirty days after an organization receives assets, the organization has to register with the Attorney General’s Registry of Charitable Trusts by filing Form CT-1 and the Articles of Incorporation and Bylaws with the Attorney General. A statement describing the primary activities is also filed. The fee is $25.
If the organization pays more than $100 in wages in a quarter, the organization must file as an employer by submitting a DE 1GS form to the Employment Development Department, or by using the EZREG system online. The information includes organization status, wages, business name and address, organization name and type, officer names and titles, and non-profit activities.
Income Tax Exemption
Non-profits organized for a charitable purpose can file form 3500 with the Franchise Tax Board (FTB) for an income tax exemption. Copies of organization documents, financial statements, and statements describing the purpose and activities accompany the application. A $25 fee.
Sales and Use Tax Exemption
A non-profit can get an exemption from sales and use tax by requesting a “review of eligibility” from Compliance Planning & Evaluation at the Board of Equalization (BOE). The filing includes bylaws, articles of incorporation, a IRS 501(c)(3) determination letter, an FTB income tax determination letter, and a letter describing the organization’s primary activities.
Property Tax Exemption
Charities that primarily serve the underprivileged can exempt the property used for this purpose from property tax. An application for a welfare exemption is filed with the Franchise Tax Board. Start-up documents, financial statements, and activities descriptions are included.
License to Issue Securities
The Department of Corporations can issue a license to a charity that chooses to issue securities. An application is sent to the department in Sacramento. Charities rarely use the license.
If an organization sells or leases merchandise, vehicles, or other tangible personal property, the organization must get a seller’s permit by fling an application, form BOE-400-SPA, and sending the application to the nearest BOE district office. An organization that sells for 90 days or less applies for a temporary seller’s permit.
Local Licenses and Permits
Check with the county and city governments for license and permit requirements.
Attorney General Jerry Brown, “California Attorney General’s Guide for Charities,” website of Attorney General, State of California (2005 revision).