Presentation delivered to The Foundation Center in NY on March 11, 2014

1. Demystifying State Charity
Registration Laws
The Foundation Center
Delivered by
Tony Martignetti, Esq.
Martignetti Planned Giving Advisors, LLC
March11, 2014

2. 2
Where We’re Headed
• What is Charity Registration
• Why comply with the laws
• Where do you register
• What is a solicitation
• How do you register
• Registration in NY
• Plan for how to get going
• Continuing Education
tonymartignetti.com

3. 3
What Is Charity Registration
Requirements throughout the states and
D.C. that charities register with
authorities--or be exempt--everywhere
they solicit.
tonymartignetti.com

4. 4
Why Comply With The Laws
• IRS Form 990
• Criminal & civil penalties, including
- NY: civil fraud
- NJ: civil fine, $10,000
- CT: criminal; 1 yr/$5000
- PA: misdemeanor; 5 yrs/$10,000
- MD: civil fine, $5000
- DC: civil fines, penalties, fees
- FL: 3rd degree felony; 5 yrs/$5000
- GA: civil fine; $25,000
tonymartignetti.com

5. 5
Why Comply With The Laws
• Board member liability; fiduciary duty
• Gift challenge from donor or heir
- Disgruntled donor hires enterprising
attorney
• Right thing to do; operate within the laws
tonymartignetti.com

6. 6
Where We Are
√ What is Charity Registration
√ Why comply with the laws
• Where do you register
• What is a solicitation
• How do you register
• Registration in NY
• Plan for how to get going
• Resources
tonymartignetti.com

7. 7
Where Do You Register
Everywhere you solicit,
except where you’re
exempt
tonymartignetti.com

8. 8
What Is A Solicitation
• Varies state to state
• A few neat categories
tonymartignetti.com

9. 9
What Is A Solicitation
• Mere existence of website accepting
donations
- “Donate Now” button
- Passive solicitation
- NY, NJ, FL, GA, IL, DC, VA, others
tonymartignetti.com

10. 10
What Is A Solicitation
• Website accepting donations + induce donors to
it
- email, US mail, phone, ads, meetings, events
- Active solicitation
- CT, CA, MD, TX (not email), UT, WA, WI
tonymartignetti.com

11. 11
What Is A Solicitation
• Ask for charitable support by
- Email
- US Mail
- Phone
- Meetings
- Events
- Advertisements
• Active solicitation
• These are a solicitation in nearly every state
tonymartignetti.com

12. 12
Even If You Are Soliciting
• You might be exempt
• Exemptions vary drastically across states
- Mission, with qualifications
- Gross revenue
- Gross fundraising revenue
- Revenue from within the state (kindest)
tonymartignetti.com

13. 13
Charleston Principles
• Uniform definition of solicitation
• National Association of State Charities Officials
(NASCO)
• Not adopted by all states
• Uncertain where adopted
tonymartignetti.com

14. 14
Where We Are
√ What is Charity Registration
√ Why comply with the laws
√ Where do you register
√ What is a solicitation
• How do you register
• Registration in NY
• Plan for how to get going
• Resources
tonymartignetti.com

15. 15
How Do You Register-Forms
• Vary drastically across the states
• Unified Registration Statement (URS)
• A few neat categories
- URS only (+ state idiosyncrasies) (NY)
- URS + state forms
- Non URS
--”foreign corporation doing business”
tonymartignetti.com

16. 16
How Do You Register-Docs
• Typical documents
- By laws & articles of incorporation
- IRS determination letter
- Board list
- Financial report
- IRS Form 990
tonymartignetti.com

17. 17
How Do You Register-Fees
• A few neat categories
- Flat (NY)
- Tiered by gross revenue or contributions
- Tiered by in-state revenue (kindest)
• HI most expensive: $750 for largest
• 32 ≤ $100
• 3 free: KY, MI, NM
tonymartignetti.com

18. 18
How Do You Register in NY
• 2 governing laws
- Executive, EPTL
• Exemptions
- Religious
- Education, with qualifications
- Gross contributions under $25,000 & no
professional fundraisers (incl. employees)
- All or most funding from 1 gov’t agency, with
qualifications
- Veterans, law enforcement, PTA
tonymartignetti.com

19. 19
How Do You Register in NY
• Apply for exemption
• Not exempt
- URS or state form (CHAR 410)
- IRS tax exempt letter, by-laws, articles of
incorp., 990, financial stmnt.
- Indefinite registration for $25
- Annual financial reporting
tonymartignetti.com

20. 20
NY Annual Financial Reporting
• Gross revenue under $100,000
- unaudited report + $10
• Gross revenue up to $250,000*
- fin. stmnt w/CPA review + $10
• Gross revenue over $250,000* or paid
fundraisers
- audited fin. stmnt w/CPA opinion + $25
*changes to $500,000 on 7/1/14
tonymartignetti.com

21. 21
Where We Are
√ What is Charity Registration
√ Why comply with the laws
√ Where do you register
√ What is a solicitation
√ How do you register
√ Registration in NY
• Plan for how to get going
• Resources
tonymartignetti.com

22. 22
Plan For How To Get Going-1
• Charity starts at home
-- enforcement also starts at home
-- FL, GA, WA
-- register there
tonymartignetti.com

23. 23
Plan For How To Get Going-2
• Very high fundraising revenue states, if
any
- dollar amount
- percentage of fundraising revenue
tonymartignetti.com

24. 24
Plan For How To Get Going-3
Web Based Fundraising
• Do you need every state?
- if not, take safe harbor & restrict giving
• Where solicit most
- descending state populations
-- www.census.gov
- work down the list
tonymartignetti.com

25. 25
Plan For How To Get Going-3
Non Web Based Fundraising
• Where solicit most
- query database for constituent
frequency by state
- descending order of frequency
- work down the list
tonymartignetti.com

26. 26
Plan For How To Get Going-4
• Don’t be intimidated or overwhelmed
• Follow a plan
• One to three per month
• May be exempt in some
- need to apply for exemption?
• You can do this
tonymartignetti.com

27. 27
Continuing Education
• tonymartignetti.com
• nasconet.org (state charity officials)
• multistatefiling.org (URS & related
• my book: Charity Registration: State-by-State
Guidelines for Compliance
• site I’m building
-- give me your card for info
tonymartignetti.com