The Network - Frequently Asked Questions

Texas Nonprofit Management Assistance Network, Inc.

Frequently Asked Questions

As individuals interested in forming a nonprofit organization or a board, staff, or volunteer of an existing organization, questions arise from time to time about starting or managing a nonprofit entity. This question and answer page will highlight frequently asked questions about nonprofit issues. In the coming months, questions will be developed for the following topics:

Board Governance
Financial, Administrative, & Legal Issues
Fundraising & Development
Human Resources
Marketing & Public Relations
Nonprofit Formation & Trends
Planning & Evaluation
Technology
Volunteerism
Other

Bookmark this page of the Network website for an ongoing tool to lead your nonprofit organization. Network members offer public workshops on these topics on a regular basis. Upcoming workshops are listed on the workshop tab.

Board Governance

Where can I find board governance materials in different languages? (March 2003)

BoardSource is Washington D.C. is known internationally for their board governance training and resources. They produce materials in Arabic, Australian English, Bulgarian, Dutch, Japanese, Portuguese, Russian, Slovak, and Spanish. Contact BoardSource at 1-800- 883-6262 or 1-202-452-6262 or www.boardsource.org.

Can Texas nonprofit organizations hold a board meeting through teleconferencing or video conferencing? (April 2002)

According to Section 9.11 of the Texas Nonprofit Corporation Act, “unless restricted by the articles or bylaws, members or directors may participate in and hold a meeting of conference telephone or similar communications equipment by means of which all person participating in the meeting can hear each other.”

As with in-person board meetings, it is advisable to publish and distribute the meeting agenda prior to the board meeting.

How many board members are required in a Texas nonprofit corporation? (May 2001)

The Texas Nonprofit Corporations Act requires a minimum of three directors on the Governing Board of Directors. In an organization's Bylaws & Articles of Incorporation, it is common to state the minimum and maximum number of members required on the Board.

What are duties of board members? (May 2001)

Board members have oversight responsibility for the nonprofit organization. The legal structure for the entity will dictate the responsibilities and liabilities of the directors. For directors of nonprofit organizations, there are three duties: the duty of care, the duty of loyalty, and the duty of obedience.

Additional Resources:

Am I Liable, Responsibilities & Liabilities of Texas Nonprofit Organization Directors, 2nd edition, Glen A. Yale. Book is available through the Nonprofit Resource Center of Texas at www.nprc.org.

The National Center for Nonprofit Boards (NCNB) is a key publisher of board governance materials. Available titles include Ten Basic Responsibilities of Nonprofit Boards, Nonprofit Board Answer Book: Practical Guidelines for Board Members and Chief Executives. Materials are available at the Online Bookstore at www.ncnb.org.

How often should a board meet? (May 2001)

In the start-up of a nonprofit organization, board members may need to meet more frequently to establish the organization. There is not a minimum number of meetings specified by state or federal law governing nonprofit organizations. Based on readings and experience with boards, many nonprofit boards meet 9-12 times per year. The amount of work often dictates how often the board meets.

Prior to the start of the organization's fiscal year, it is a good idea to survey board members about the best day and time for regular board meetings.

Financial, Administrative, & Legal Issues

Are nonprofit organizations with less than $25,000 in revenue required to file an annual form with the IRS? (November, 2007)

Effective 2008, smaller nonprofit organizations will be required to file the e-Postcard (Form 990N) every year by the 15th day of the fifth month after the close of their tax period. According to the Pension Protection Act, the IRS will revoke the tax-exempt status any of organization failing to meet their annual filing requirement for three consecutive years. Additional information is available at www.irs.gov/. Information will include the organization's name, mailing address, web address, Employer Identification Number, name and address of principal officer, organization's tax period, statement about annual revenues, and if organization is closing down business.

Is a nonprofit organization required to make public income not related to their charitable missions? (February, 2008)

Until 2006, nonprofit organizations were not required to make public the federal tax returns on income not related to their charitable purpose. However, the law now requires that all charities publicly disclose their "Exempt Organization Business Income Tax Return, the Form 990-T. The law covers forms filed with the IRS after August 17, 2006, the date the statute went into effect. This guideline applies to all organization with charity status under Section 501(c)(3) of the Internal Revenue Code including churches and religious groups that are exempt from filing the Form 990. Disclosure rules require that nonprofit organizations provide a copy of their Form 990-T on the same day as requested by an individuals. If there is a written request, it must be provided within 30 days. If charities refuse to provide the forms or allow them to be copied, they can be fined $20 per day up to a maximum of $10,000. If copies are easily accessible through their website, they are not required to provide a separate copy. For additional information, contact go to www.irs.gov.

How does a nonprofit organization change its name in Texas? (December, 2007)

The nonprofit organization must file a Certificate of Amendment with the Secretary of State's Office.

An entity that is governed by the Texas Business Organizations Code (BOC) changes its legal name by filing a Certificate of Amendment. See Form 424 (Word 80kb , PDF 90kb) . An entity that is not governed by the BOC changes its legal name by filing Articles of Amendment. See Forms 404-409.

Must a charitable nonprofit organization register with the state of Texas? (May, 2007)

The majority of nonprofits are not required to register with the state of Texas. However, exceptions exist for organizations soliciting funds for law enforcement, public safety, or veteran causes. Your organization may be affected by the Texas Law Enforcement Telephone Solicitation Act, the Public Safety Solicitation Act, and the Veterans Solicitation Act. Being registered does not imply endorsement. As stated on the Secretary of State’s website, “The Secretary of State is the filing agency for the documents required by the Public Safety Solicitation Act ("Act"). Registration with the Secretary of State does not imply approval or endorsement of the organization or its solicitor.” Additional information: Secretary of State’s website at www.sos.state.tx.us and the Office of the Attorney General’s website http://www.oag.state.tx.us/consumer/charityregform.pdf.

What is the Unified Registration Statement? (October, 2006)

The Unified Registration Statement (URS) is an effort to consolidate the information data requirements of all states that require registration of nonprofit organizations performing charitable solicitations within their jurisdictions. It is organized by the National Association of State Charities Officials and the National Association of Attorney Generals. It is one Standardized Reporting Project and it is meant to standardize and simplify the reporting requirements for nonprofit organizations. The most recent version of the URS is v.3.02. http://www.multistatefiling.org/

Which state department represents the public interests in charity? (March 2005)

The Attorney General Office's represents the public interest in charity and acts to protect that interest. The Charitable Trusts Section of the AG's Consumer Protection Division has key responsibilities in this area.

What website outlines the duties of the Charitable Trust Section? (March 2005)

The website is http://oag.state.tx.us/consumer/charitabletrusts.shtml

What form can I use to file a complaint about a Texas tax exempt entity (March 2005)

The form can be downloaded at http://www.oag.state.tx.us/consumer/charitycomplaint.pdf

What is Form 1024? (February 2005)

It is the IRS form used to apply for certain types of exempt organizations. If you are applying as a 501(c)(2), (4), (5), (6), (7), (8), (9), (10), (12), (13), (15), (17), (19), (25) organization, use this form to apply for exemption from the IRS. The form and instructions are available at www.irs.gov.

What is the filing fee for tax exempt status with the IRS? (February 2005)

Nonprofit organizations seeking first-time rulings that qualify as charities generally will continue to pay $500. A reduced fee of $150 applies to organizations with annual receipts of $10,000 or less during the previous four years. For additional information, go to www.irs.gov.

What are the IRS Group Exemption Numbers, Subsection Codes and Classification Codes for tax exempt organizations? (September 2004)

Based on the tax exempt application, the IRS determines whether the organization is exempt according to one of the following codes.

Table of EO Subsection and Classification Codes

Subsection Code	Classification Code	Description
01	1	Government Instrumentality
02	1	Title-Holding Company
03	1	Charitable Organization
03	2	Educational Organization
03	3	Literary Organization
03	4	Organization to Prevent Cruelty to Animals
03	5	Organization to Prevent Cruelty to Children
03	6	Organization for Public Safety Testing
03	7	Religious Organization
03	8	Scientific Organization
04	1	Civic League
04	2	Local Association of Employees
04	3	Social Welfare Organization
05	1	Agricultural Organization
05	2	Horticultural Organization
06	1	Board of Trade
06	2	Business League
06	3	Chamber of Commerce
06	4	Real Estate Board
07	1	Pleasure, Recreational, or Social Club
08	1	Fraternal Beneficiary Society, Order or Association
09	1	Voluntary Employees’ Beneficiary Association (Non-government Employees)
09	2	Voluntary Employees’ Beneficiary Association (Government Employees)
10	1	Domestic Fraternal Societies and Associations
11	1	Teachers Retirement Fund Association
12	1	Benevolent Life Insurance Association
12	2	Mutual Ditch or Irrigation Company
12	3	Mutual Cooperative Telephone Company
12	4	Organization Like Those on Three Preceding Lines
13	1	Burial Association
13	2	Cemetery Company
14	1	Credit Union
14	2	Other Mutual Corporation or Association
15	1	Mutual Insurance Company or Association Other Than Life or Marine
16	1	Corporation Financing Crop Operations
17	1	Supplemental Unemployment Compensation Trust or Plan
18	1	Employee Funded Pension Trust (Created Before 6/25/59)
19	1	Post or Organization of War Veterans
20	1	Legal Service Organization
21	1	Black Lung Trust
22	1	Multiemployer Pension Plan
23	1	Veterans Association Formed Prior to 1880
24	1	Trust Described in Sect. 4049 of ERISA
25	1	Title Holding Company for Pensions, etc.
26	1	State-Sponsored High Risk Health Insurance Organizations
27	1	State-Sponsored Workers’ Compensation Reinsurance
40	1	Apostolic and Religious Organization (501d)
50	1	Cooperative Hospital Service Organization (501e)
60	1	Cooperative Service Organization of Operating Educational Organization (501f)
70	1	Child Care Organization (501k)
71	1	Charitable Risk Pool
81	1	Qualified State-Sponsored Tuition Program
92	1	4947(a)(1) – Private Foundation (Form 990PF Filer)

How long are nonprofit organizations required to maintain documents? (December 2003)

It is recommended that nonprofit organizations have a written document retention and destruction policy. The National Council of Nonprofit Associations in Washington, D.C. has published the following table with the minimum retention requirements:

Type of Document	Minimum Requirement
Accounts payable ledgers and schedules	7 years
Audit reports	Permanently
Bank reconciliations	2 years
Bank statements	3 years
Checks (for important payments and purchases)	Permanently
Contracts, mortgages, notes and leases (expired	7 years
Contracts, mortgages, notes and leases (still in effect)	Permanently
Correspondence (general)	2 years
Correspondence (legal and important matters)	Permanently
Correspondence (with customers and vendors)	2 years
Deeds, mortgages, and bills of sale	Permanently
Depreciation schedules	Permanently
Duplicate deposit slips	2 years
Employment applications	3 years
Expense analyses/expense distribution schedules	7 years
Year end financial statements	Permanently
Insurance policies (expired)	3 years
Insurance records, current accident reports, claims, policies, etc.	Permanently
Internal audit reports	3 years
Inventories of products, materials, and supplies	7 years
Invoices (to customers, from vendors)	7 years
Minute books, bylaws, and charter	Permanently
Patents and related papers	Permanently
Payroll records and summaries	7 years
Personnel files (terminated employees)	7 years
Retirement and pension records	Permanently
Tax returns and worksheets	Permanently
Timesheets	7 years
Trademark registrations and copyrights	Permanently
Withholding tax statements	7 years

What is the optional standard mileage rate for 2007? (January, 2007)

Beginning Jan. 1, 2007, the standard mileage rates for the use of a car including vans, pickups, or panel trucks will be:

48.5 cents a mile for all business miles driven;
20 cents a mile when computing deductible medical or moving expenses; and
14 cents a mile when giving services.

What is fiscal sponsorship of a nonprofit organization? (September 2003)

A fiscal sponsorship typically arises when a person or group wants to receive a grant from a private foundation or a government entity or tax-deductible gifts from individuals or corporate donors. Many of these entities can only make gifts to tax-exempt 501(c)(3) organizations. The organization then asks a tax exempt entity to serve as its sponsor so they can apply for the funds.

For additional information, go to www.silklaw.com. Greg Colvin from the law firm of Silk, Adler, and Colvin in San Francisco has published a book about fiscal sponsorships and an executive summary is available on the publications section of the website. The Lawyers Alliance for New York has also published a booklet about this subject and it is available at www.lany.org.

What are pro bono resources available to nonprofit organizations? (June 2003)

There are several resources for nonprofit organizations needing pro bono (free) legal help:

Texas C-Bar: Offers free legal assistance to nonprofit organizations, especially to organizations working in low-income neighborhoods. Attorneys help organizations with their real estate, tax, corporate, and employment law needs. The organization also offers free legal workshops throughout Texas. www.texascbar.org.
Texas Accountants & Lawyers for the Arts: Offers pro bono accounting and legal assistance to arts organizations. TALA serves the entire state of Texas with the exception of Dallas. The Dallas area is served by LANTA. www.tala.org
Power of Attorney: Uses the power of business attorneys to support nonprofit services through donating free legal services. One resource is a 10-Point Checklist for Nonprofits to determine if they need legal council. Their website www.powerofattorney.org contains a description of services, participants by state, and a list of legal resources.

Are Texas nonprofit organizations exempt from the hotel occupancy tax? (March 2003)

When your staff or board members travel, nonprofit organizations do not need to pay Texas hotel taxes. It is a good practice to print copies of the Texas Hotel Occupancy Tax Exemption Certificate for your travels. To print this certificate:

Type in Texas State Controller’s office on the Internet search line.
When you get to the website, type Texas Hotel Occupancy Tax Exemption Certificate on their search line.
Open up the PDF file with the form and print.

What are general guidelines for reporting tax-deductible charitable contributions and for taxpayers making contributions? (June 2002)

The IRS has two general guidelines that organizations need to be aware of to meet substantiation and disclosure requirements for federal income tax return reporting purposes:

A donor is responsible for obtaining a written acknowledgement from a charity for any single contribution of $250 or more before the donor can claim a charitable contribution on his/her federal income tax return.
A charitable organization is required to provide a written disclosure to a donor who receives goods or services in exchange for a single payment in excess of $75.

The written acknowledgment can be in the form of a letter, postcard, computer-generated form, or email. The IRS Publication 1771, Charitable Contributions, Substantiation and Disclosure Requirements, outlines the required information for a written acknowledgment. The publication can be downloaded in PDF format from http://www.irs.gov/pub/irs-pdf/p1771.pdf.

What are the duties of an audit committee? (May 2002)

The following response was prepared by Sandra Geppert, Audit Partner at Carneiro, Chumney, and Company, www.carneiro.com.

Professional firms have recently received questions about audit committee responsibilities due to the situations at Enron and Anderson. Although nothing has been passed down from the SEC or AICPA as regulation, nonprofit groups might want to revisit the functions of the committee.

The activity of a typical audit committee:

Review of the financial statements with the independent accountants prior to recommending approval by the Board. The purpose of such a review is to determine that the independent accountants are satisfied with the disclosure and content of the financial statements and to obtain sufficient information from the auditors to facilitate analysis of the financial statements submitted to the entire board of trustees.
Appraisal of the effectiveness of the audit effort. This includes a discussion of the overall approach to and scope of the examination, with particular attention focused on those areas where either the committee or the independent accountants believe special emphasis is desirable or necessary.
Determination through discussions with the independent accountants that no restrictions were placed by management on the scope of the examination or on its implementation. It is often appropriate for management representatives to allow the committee to meet alone at some point with the independent accountants. This is not intended in any sense to reflect adversely on the integrity of management; instead, it provides an additional margin of security in that there will be an opportunity for complete interchange, without the inhibitions or restrictions that might exist if members of the management team were present. It also establishes for the record that the independent accountants were presented a chance to discuss with the committee any topics they might choose.
Inquiry into the effectiveness of the organization's management of financial and accounting functions, through discussions with the independent accountants and appropriate officers of the organization. Particular attention should be paid to the adequacy of internal control over contributions and other sensitive areas.
Review of reports prepared by the independent accountants discussing weakness in internal control, organizational structure and operations, and containing recommendations to improve such weaknesses. There should be careful consideration of the action taken by management on the independent accountants' suggestions.

What software accounting packages are used by nonprofit organizations? (July 2001)

A nonprofit organization should consider multiple factors in selecting an accounting package:

required degree of sophistication,
types of transactions,
internal staff expertise,
external financial expertise,
types of financial reports required,
computer parameters, and
any cost restrictions.

Fund accounting software programs maintain separate balance sheets (assets, liabilities, fund balance) for each account. FundWare, MIP Fund Accounting System, and Fund E-Z Fund are examples of fund accounting software programs. However, many nonprofit organizations discover that an off-the-shelf business program such as QuickBooks Pro, Quicken, or Peachtree is adequate for their accounting needs.

The web resource http://www.nfpaccounting.com contains the following tools:

Guide to Selecting a Nonprofit and Fund Accounting Software,
Checklist for Selecting Your Nonprofit Accounting Software Solution,
How Much Should Your Nonprofit Accounting Software Solution Cost, and
Nonprofit Accounting Software Vendors

Nonprofit organizations can also discuss their software needs with their accounting firm. If organizations do not have an accounting firm, they can contact the Texas Society of Certified Professional Accountants at www.tscpa.org. Their website contains a map with links to the 20 CPA chapters throughout Texas.

What is the purpose of a financial statement audit? (July 2001)

The audit is to analyze the information presented in financial statements prepared by management for the nonprofit organization and to verify whether those statements fairly represent the financial activity for that time period. The organization's bylaws, a lender, or funder may require a financial audit. For a financial statement audit, it is best to have at least two years of comparable financial statements.

A concise resource is Checks and Balances: The Board Member's Guide to Nonprofit Financial Audits by Andrew S. Lang published by the American Society of Association Executives and the National Center for Nonprofit Boards. The book is available at www.ncnb.org. Also check the availability of this book at the Cooperating Collection libraries in Texas by clicking on the libraries tab at the Network website at www.txnetwork.org.

What is Directors and Officers Liability Insurance? (July 2001)

Directors and Officers Liability Insurance is a specialized insurance to cover board members, staff, and volunteers who are serving or working on behalf of a nonprofit organization. It protects these individuals from alleged negligent acts of the organization's officers, directors and employees regardless of compensation. The Nonprofits Insurance Alliance of California is a leader in nonprofit insurances. They advise nonprofit organizations to check if the insurance policy uses the broader definition of insured person. I.e. "any natural person who was, is or becomes a director, trustee, officer, employee, committee member, or volunteer" as well as "the nonprofit organization itself."

One of the greatest benefits of D&O insurance is that the insurance company will pay for the defense of the lawsuit after the nonprofit organization pays the deductible. When selecting D& O insurance, nonprofit organizations should discuss in detail with prospective carriers, the work of their nonprofit, the types of programs and services, and the definition of exclusions in the policy.

The Nonprofits' Insurance Alliance of California publishes a helpful book, Nonprofit Directors & Officers. To download this book in PDF format, click on www.niac.org, Member Services, Educational Booklets.

Fundraising and Development

Does anyone publish a proposal writing book in Spanish? (July 2003)

The Foundation Center in New York publishes its Guide to Proposal Writing in Spanish. Titled Guía Para Escribir Propuestas, the book is the 3rd edition written by Jane C. Geever and translated by Liliana Castro, Trujillo, and Marco A. Mojica. The volume features Pre-Proposal Planning Tips, Sample Proposals, and Grantmaker Guidance. Guía Para Escribir Propuestas also features a special appendix listing consultants and technical assistance providers who can help Spanish speakers craft proposals in English, or give advice on fundraising. The book costs $34.95 plus shipping and handling. Call 1-800-424-9836 or order online at www.fdncenter.org/marketplace.

What are resources for learning about funders in Texas? (June 2003)

The following organizations produce print or online resources for grant seekers:

Fort Worth: The Funding Information Center of Fort Worth publishes The Directory of Grantmakers; the 9th edition is available in a print or online version at www.fic-ftw.org.
San Antonio: The Nonprofit Resource Center of Texas publishes The Directory of Texas Foundations in a print and online version on an annual basis. www.nprc.org
San Antonio: www.texasnonprofits.org publishes an online funding directory as a benefit of paid membership. Membership rates are printed at http://www.texasnonprofits.org/Rates.asp

How can I locate new foundations within Texas? (March 2003)

The Directory of Texas Foundations is published each year by the Nonprofit Resource Center of Texas at www.nprc.org. It always includes newly listed foundations; in the 22nd edition, there are approximately 150 new entries in this category. In addition, grant seekers can conduct online grant searches at their local Cooperating Collection libraries. A list of Texas Cooperating Collection libraries is posted on the Network website for your convenience.

Can Texas nonprofit organizations hold raffles? (September 2002)

The Charitable Raffle Enabling Act, effective January 1, 1990, permits “qualified organizations” to hold up to two raffles per calendar year, with certain specified restrictions. Listed below are key guidelines outlined in the Charitable Raffles brochure from the office of the Attorney General of Texas:

Qualified organizations may hold only two raffles per year and only one raffle at a time,
Raffle tickets may not be advertised statewide or through paid advertisements,
A prize may not be money,
There are limitations on who can sell the tickets, and
No one can receive direct or indirect compensation for organizing or conducting a raffle.

Individuals can obtain a copy of the brochure in the following ways:

Check www.oag.state.tx.us under the Consumer Protection Division Frequently Asked Questions, or
Call the Consumer Protection Division at 1-800-621-0508.

How do I locate the Texas chapters of the Association of Fundraising Professionals? (September, 2009)

The Association of Fundraising Professionals has a list of chapters by state at their website at www.afpnet.org Texas has thirteen chapters: Abilene, Central Chapter, Amarillo: Texas Plains Chapter, Austin: Greater Austin Chapter, Corpus Christi: Coastal Bend Chapter, Dallas: Dallas Chapter, El Paso Chapter, Fort Worth: Fort Worth Metro Chapter, Houston: Greater Houston and University of Houston Collegiate Chapter, Lubbock: Lubbock Area Chapter, Permian Basin Chapter, San Antonio Chapter, Tyler: East Texas Chapter, Waco Area: Central Texas, and the West Texas - South New Mexico Chapter. At the website, visitors can click on chapters, locate the closest chapter, and learn information about member benefits, meeting times, and events.

How should board members be involved in fundraising activities? (August 2001)

Board members should play an integral role in fundraising activities for a nonprofit organization. As governing board members, they have legal and fiduciary responsibility for the organization. Ensuring adequate financial resources for a new or established nonprofit organization is an ongoing critical role for board members. Listed below are multiple ways for board members to participate in fundraising activities:

Approve an annual operating budget with diversified funding categories,
Give a meaningful financial gift each year to the nonprofit organization,
Make introductions to private foundations or corporations,
Participate in fundraising calls to individuals, private foundations, corporations, and public funders,
Submit prospect names for the mailing list and Annual Fund Drive, and
Create and staff special event fundraisers for the nonprofit organization.

Board members contribute talents, financial gifts, and connections to the nonprofit organizations. Board members can learn about nonprofit fundraising by attending workshops at local nonprofit resource centers. Check the workshop tab at www.txnetwork.org for training in your community.

What are strategies for raising funds for a nonprofit organization? (June 2001)

Nonprofit organizations employ various fundraising strategies for their new or established organizations. The most common strategies are operating and project grants from private foundations, public grants, contracts for service, earned income, corporate cash or in-kind gifts, United Way, Annual Fund Drives, membership dues, special events, and endowments.

As the board approves the budget each year, it is important to develop a diverse funding strategy for the organization.

When pursuing private foundation grants in Texas, check the websites of the Funding Information Center of Fort Worth at www.fic-ftw.org and the Nonprofit Resource Center of Texas at www.nprc.org. These organizations produce annual funding directories with detailed information about Texas foundations, their grant requirements, and deadlines.

Human Resources

Must a Texas employer report new hires? (May, 2007)

Federal and state laws require employers to report new hires within 20 days of their hire date. The information is input to state registries and transmitted to the National Directory of New Hires. State and federal child support agencies are using this database to locate parents who have not paid child support obligations. Employers can report by internet, mail, fax, or phone. Go to www.newhire.org/tx for additional information.

What is a tool for conducting a human resources audit in my nonprofit organization? (August 2002)

La Piana Associates, a management consulting firm in California, has designed a Human Resources Audit. The audit asks organizations to answer questions in the eight primary components of the HR function:

Roles, head count, and HR information systems (HRIS)
Recruitment
Documentation
Training, development, and career management
Compensation and benefits
Performance measurement and evaluation
Termination and transition
Legal issues and personnel policies

An audit instrument is a diagnostic tool, but it will not outline what needs to be done. After an HR audit is completed, your organization can work with its senior management team, Board, and an employment law attorney to determine the next steps for your organization. Organizations can download the complete HR audit at www.lapiana.org.

What is the federal minimum wage? (August 2002)

According to the Fair Labor Standards Act, “employers of covered employees who are not otherwise exempt to pay these employees a minimum wage of not less than $5.15 an hour as of September 1, 1997. Youths under 20 years of age may be paid a minimum wage of not less than $4.25 an hour during the first 90 consecutive calendar days of employment with an employer. Employers may not displace any employee to hire someone at the youth minimum wage.” For additional information about Wage and Hour guidelines, check the Department of Labor website at www.dol.gov.

Where can I obtain copies of the Federal Labor Law Posters? (August 2002)

Employers in the United States are required by law to post the most current federal and state labor laws so that employees and applicants can easily see them. HR Direct is one company that provides the Federal Labor Law posters in English and Spanish. Their products are available at www.hrdirect.com.

What are resources for locating a job in the nonprofit or foundation field? (October 2001)

Several Network members offer job posting services for individuals wanting to change nonprofit employers or to enter the nonprofit field. The Center for Nonprofit Management in Dallas publishes a print and online version of Opportunity NOCS, a classified paper for nonprofit positions. The Nonprofit Resource Center of Texas in San Antonio also has a job posting service on its website.

Listed below are other nonprofit organizations providing job posting services or links on their websites:

Alliance for Nonprofit Management, www.allianceonline.org
American Humanics, www.humanics.org/employment_in_nonprofits.htm
Council on Foundations, www.cof.org
CompuMentor, www.techsoup.org/careercorner.cfm

The American Humanics website is a good resource for jobseekers as it provides links to multiple nonprofit job services on the web.

Marketing & Public Relations

What is a resource for online press releases? (April 2002)

PR Newswire is the world’s largest electronic distributor of online press releases. This service has 35,000 members and the news releases are distributed via Web satellite networks reaching all the audiences.

The annual membership fee is $100 and the fee for releases depends on the number of words and the distribution area. Additional information about PR Newswire is available at www.prnewswire.com . At the website, individuals can review more program details in the “PR Toolkit” section.

What are some ways to make giving easy for donors? (April 2002)

Nonprofit organizations use multiple strategies for raising revenue for their organizations. All donors are investors in nonprofit organizations and nonprofit organizations need to approach potential donors from that perspective.

All nonprofit organizations have ongoing opportunities and challenges in marketing their organizations to potential and prospective donors. With the variety and number of nonprofit organizations funding requests, creators of marketing and solicitation materials need to make it clear and easy for donors. Listed below are marketing suggestions from several sources:

Personalize your marketing pieces; use the individual’s name or personalize the salutation,
Include a courtesy reply envelope non-postage paid or a business reply envelop, postage paid,
Answer the key questions:
• Why your organization needs the funds,
• Use of the funds, and
• When the funds will be spent
Provide referrals to professional resources such as accountants, tax attorneys, etc.
Do prospect research and ask for the right amount,
Repeat the ask in the marketing brochure, and
Provide multiple ways to give to your organization.
• Check
• Credit card
• Payroll deduction
• Electronic funds transfer

Nonprofit Formation & Trends

What are the fees to file Form 1023 with the IRS for tax exemption? (March, 2010)

The IRS has a two-tiered filing fee structure. Effective January 4, 2010, most organizations will pay the standard $850 filing fee. Organizations that expect to have (or have had) no more than $40,000 in gross revenue for the first four years combined can pay a reduced filing fee of $400.

Q	How can I learn the requirements for a tax exempt entity? (September 2005)
A	The IRS website contains articles exemption requirements, the Application for Recognition of Exemption, and other forms. http://www.irs.gov/charities/charitable/article0,,id=96099,00.html
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Where can I obtain a copy of the Texas Nonprofit Corporation Act? (May 2005)

The Texas Nonprofit Corporation Act is contained in Title 32 (Corporations), Chapter 9, of Vernon's Texas Civil Statutes, starting with Article 1396-1.01. Go to http://www.capitol.state.tx.us/statutes/statutes.html "Vernon's Texas Civil Statues", title 32.

Which state agency handles corporate income or franchise tax? (May 2005)

The Comptroller of Public Accounts in Austin handles these taxes. Go to http://window.state.tx.us.

What is a 501(c)(3) organization? (May 2001)

The Internal Revenue Service determines whether an organization is a 501(c)(3) organization. If designated a 501(c)(3) organization, the organization is exempt from federal income tax.

The purpose of a 501(c)(3) organization is religious, charitable, (includes) healthcare organizations, scientific, literary, testing for public safety, foster national or international amateur sport competition, and prevention of cruelty to children or animals.

Are there other types of tax-exempt organizations? (May 2001)

The Internal Revenue Code lists major categories of tax-exempt organizations. I.e. Charitable Organizations, Social Welfare Organizations, Labor and Agricultural Organizations, Social Clubs, Fraternal Societies, Veterans' Organizations, Employees' Associations, Political Organizations, and Other Tax-Exempt Organizations.

Additional Resources:

Contact your local Cooperating Collection library for available resources.
Click on the following page of the Internal Revenue Service for additional information at www.irs.ustreas.gov/prod/bus_info/eo/eo-types.html.
The Bruce R. Hopkins text, A Legal Guide to Starting and Managing a Nonprofit Organization (John Wiley, Second Edition 1993) contains a table listing the types of tax-exempt organizations.

What is required to form a (501)(c)(3) organization? (May 2001)

An individual or group of individuals must write Bylaws, Articles of Incorporation, Form 1023, and form an initial Board of Directors.

A good resource is the Secretary of State's website at www.sos.state.tx.us/corp/index. Click on nonprofit under the Forms & Summaries for additional information.

Are there any organizations that are not required to file Form 1023 with the Internal Revenue Service? (June 2001)

According to the Internal Revenue Service, the following organizations may be considered tax-exempt 501(c)(3) organizations even if they do not file Form 1023:

Churches,
Integrated auxiliaries of churches, and conventions or associations of churches,
Any organization that:
A) Is not a private foundation as defined in section 509(a), and
B) Has gross receipts in each taxable year of normally not more than $5,000.

However, many of these organizations choose to complete Form 1023 in order to receive a Determination Letter that recognizes their 501(c)(3) status.

How long does it take to obtain tax-exempt status? (June 2001)

Individuals forming a tax-exempt organization must complete or develop Bylaws, Articles of Incorporation, Form 1023, and form an initial Board of Directors.

These materials are submitted to the Internal Revenue Service for a decision. Applications are processed as they are received. If the materials are complete, an approximate time for a decision is 90-120 days after filing.

What is an Employer Identification Number? (June 2001)

An Employer Identification Number (EIN) is a nine-digit number assigned to sole proprietors, corporations, partnerships, estates, trusts, and other entities for tax filing and reporting purposes. E.g. 12-3456789. It is advisable to obtain an EIN even if you do not have employees at this time in your nonprofit organization. This number is used for business purposes only; do not use the organization's EIN in place of your social security number.

Organizations can apply for an EIN by mail or by phone. Complete Form SS-4 to apply for an EIN number for your business; it can be downloaded from the IRS website at www.irs.ustreas.gov/prod/bus_info/eo/eo-types.html. After you sign and date the form, mail it to the service center for your state - your organization will receive its EIN in the mail in approximately 4 weeks. Call 1-800-829-1040 to check the status of an application by mail.

If in a hurry, organizations can obtain an EIN under the TELE-TIN program. In Texas, call Entity Control at (512) 460-7843.

What are fees in Texas for transactions such as Reservation of a Corporate Name, Change of a Registered Agent, or Articles of Dissolution? (June 2001)

Listed below are the current fees in Texas:

Reservation of a Corporate Name/$40.00
Change of a Registered Agent/$25.00
Articles of Dissolution/$5.00

Forms and a complete Fee Schedule are available at the website of the Office of the Secretary of State, Corporations Section at www.sos.state.tx.us. The information is included in the Corporation and Other Business Organizations under Forms and Summaries. Forms can also be obtained by calling 1-900-263-0060.

Planning & Evaluation

What are some resources for learning about standards or accountability programs for nonprofit organizations? (June 2003)

Several organizations are working to inform donors, the public, and funders about the capabilities and effectiveness of nonprofit organizations. Check the following resources to learn more about their programs and services:

BBB Wise Giving Alliance: The organizations publish standards and an implementation guide for nonprofits. The standards were designed to assist donors in funding decisions and to foster public confidence in charitable organizations. www.give.org/standards.
Guidestar: This website provides financial and organizational information about nonprofit organizations and foundations. Individuals can review the 990 form to learn more organizations, their accomplishments, and goals. www.guidestar.org.
Maryland Association of Nonprofit Organizations: This statewide organization produced the Standards of Excellence program. Based on 8 Guiding principles and 55 standards, the program encourages nonprofits to obtain a leadership standard in all 8 areas. http://www.marylandnonprofits.org.
Other State Standards Programs: The Georgia Association of Nonprofit Organizations, http://fdncenter.org/atlanta/ Louisiana Association of Nonprofit Organizations, www.lano.org; North Carolina Center for Nonprofits, www.ncnonprofits.org; Ohio Association of Nonprofit Organizations, www.ohiononprofits.org; and Pennsylvania Association of Nonprofit Organizations, www.pano.org are participating in a replication program of the Maryland standards program. Check their websites for information about their information and programs in this area.

How can my agency learn about outcome measurement and evaluation? (May 2002)

The United Way of America has been a leader in working with agencies to develop outcome measures for their work. In 1996, United Way worked with the Urban Institute as its technical consultant to publish Measuring Program Outcomes: A Practical Approach. They have also published a training kit and a video to explain the key terms, concepts, and the links between United Way funding and program outcomes.

To order the following resources, call 1-800-772-0008:

Measuring Program Outcomes: A Practical Approach - $5.00 plus shipping and handling
Measuring Program Outcomes Training Kit - $35.00 plus shipping and handling
Video: Introducing Outcomes: Basic Definitions and Concepts in Program Outcome Measurement - $20.00 plus shipping and handling

Additional outcome measurement resources can be downloaded from the United Way website at http://national.unitedway.org/ in the “Programs and Initiatives” section.

What types of data management software systems are available to nonprofit organizations? (May 2002)

United Way of America issued a report, Outcome Measurement Data Management Systems for Agencies in September 2001. This report provides 2-page descriptions of commercially available software, hardware requirements, training options, cost, and contact information for current customers. Although United Way has not evaluated or endorsed these products, the report is an excellent starting point for research and comparison of products. To download the report, go to http://national.unitedway.org/outcomes/resources/data_management_systems.cfm

What is Strategic Planning? (May 2002)

It is the process of determining what an organization intends to be in the future and how it intends to get there. Various planning processes exist, but they often involve discussions and choices about the mission of your organization, programs and services, board, staff, and volunteer recruitment, and funding strategies.

The Amherst H. Wilder Foundation at www.wilder.org publishes the Strategic Planning Workbook, Revised and Updated. The manual costs $25.00 with discounts for multiple copies. Call 1-800-274-6024 to order or order online through www.amazon.com. Another practical planning tool is the Self-Assessment Tool from the Drucker Foundation at www.pdaf.org or call 1-212-224-1174.

How do I locate a facilitator for a strategic planning retreat? (May 2002)

Management resource centers in Texas and independent consultants provide facilitation skills for board and staff retreats. Prior to a retreat, facilitators will meet by phone or in person to determine outcomes for the retreat and to gather background information. It is common for facilitators to price consulting services based on the preparation, presentation, and summary time. Some consultants have a sliding fee scale based on budget size. Listed below are several ways to locate facilitators in Texas:

Check the consultant section of Texas Nonprofit Management Assistance Network website at www.txnetwork.org.
Use the Provider Search of the Alliance for Nonprofit Management at www.allianceonline.org. Visitors can search by state, name, or type of assistance.
Check the website of the Southwest Facilitators Network at www.southwestfacilitatorsnetwork.org.

Technology

How do I ensure that fonts and formatting features are retained in my emails? (July 2002)

Email is a quick and convenient way to publicize the programs and services of your Center. However, when you send email with formatting and color fonts, the formatting does not always stay the same as on your machine. If you want to use different fonts and features such as bullets and retain that formatting, take the following steps:

Click on Tools in your Email menu.
Select Options.
Click on Mail Format.
Change the compose mail line to the HTML format.

What is a good resource for learning about virus protection? (July 2002)

The website www.microsoft.com/security/articles/remedies_viruses.asp contains useful information about preventative actions to take as well as actions when a virus has occurred. This website also outlines how to determine if a virus alert is real or a hoax. To help you better understand this subject, it provides the following definitions:

Virus: A program that attaches itself to a “host” program and can cause damage to hardware, software, and files.
Worm: A stand-alone self-replicating program that invades computers and consumes memory, thus causing a computer to crash.
Trojan horse: A computer program that appears to be useful but conceals an unexpected function, which is typically damaging.

How can my nonprofit organization locate funders who will support technology efforts? (April 2002)

Several nonprofit foundations and online resources publish this information on a regular basis. Listed below are links to several entities that provide this information:

Benton Foundation: Information about hardware and software, in-kind-donations and cash gifts are provided at http://www.benton.org/publibrary/practice/ta/communitytoolkit.html
Tech Foundation: The monthly newsletter Tech Guide lists technology funders and upcoming grant opportunities. Click on www.techfoundation.org and subscribe in the newsletter section.

Volunteerism

What is a good bibliography for volunteerism resources? (March 2003)

Steve McCurley has completed his extensive Volunteer Management Bibliography on the Energize Website at http://www.energizeinc.com/art/biblio.html. Listing over 3,100 references of volunteer-related books and articles, the free 161-page document can be downloaded from this website.

Are there any organizations that serve managers or coordinators of volunteer programs? (November, 2007)

The Directors of Volunteers in Agencies (DOVIA) is an organization that provides training, networking, and a newsletter for individuals working with volunteers in Texas. There are 15 DOVIA chapters throughout Texas serving volunteers and in some communities, the organization has another name. A list of the chapter presidents, their phone numbers, and email addresses as of August, 2007 are listed below:

Amarillo: Johanna R. Whalon, (806) 372-7696, jwhalon@odsyhealth.com

Austin: Joanna Johnson, (512) 972-6017, joanna.johnson@ci.austin.tx.us

Brazos Valley: Kristen Schultz, (979) 595-2800, kschultz@bvcog.org

Corpus Christi: Ludie Litz, (361) 855-2213, ludielitz@kedt.org

Dallas: Leah Burke, (972) 228-2634, lburke@american-hospice.net

Denton: Julie Sacharko, (940) 382-2224, julies@span-transit.org

Fort Worth: Marie Tucker, volunteer@universal-health.com

Houston: Suzanne Staron, CVA, (281) 486-0337, ext. 110, starons@stbchurch.org

Houston: Fiona J. Dawson, (713) 679-1148, fionajdawson@yahoo.com

Lubbock: Melissa Madrid, (806) 747-2711, mmadrid@unitedway-lubbock.org

Midland/Odessa: Debbie Rogers, CVA, (432) 334-7168, rogersdl@ector-county.k12.tx.us

San Antonio: Leticia Cantu, (210) 804-6422, leticia.cantu@cs.oag.state.tx.us

Tyler: Vicki Harvey, (903) 581-6376, vharvey@uwtyler.org

What are effective strategies for recruiting volunteers? (August 2001)

Nonprofit organizations have multiple opportunities for using volunteers in their regular work and special projects. First nonprofit organizations should develop a list of projects appropriate for volunteers. Then staff can use a variety of sources to publicize and recruit volunteers:

Inform board and staff members of the types of volunteers needed,
Contact your local Volunteer Center or United Way to publicize your volunteer needs,
Publicize your volunteer projects through newsletters, websites, and printed signs within the nonprofit,
Build a relationship with local high schools, junior colleges, or universities for student volunteers,
Contact senior volunteer organizations in the community, and
Research whether your local radio, television, and newspapers list volunteer opportunities.

For additional information, read noted authors in the volunteer management field such as Susan J. Ellis, Steve McCurley, and Nancy McDuff. The website at www.energizeinc.com lists valuable information about volunteer resources and it highlights a bibliography by Steve McCurley. The bibliography gives an extensive list of volunteer resources by author.

How do I locate Volunteer Centers in Texas or other states? (August 2001)

The Points of Light Foundation based in Washington D.C. has a listing of Volunteer Centers throughout the country. Click www.pointsoflight.org for a state listing. If you live in a community without a Volunteer Center, contact a community nearby as the Volunteer Center may still have valuable information and resources to assist your organization.

How can I contact Volunteer Centers in Texas ? (May, 2010)

Here is a list of Volunteer Centers in Texas:

Volunteer Center: Hands on Central Texas, a service of the United Way Capital Area
Austin, Texas
(512) 225-0360

Sharon Zambrzycki, Manager
Volunteer Center of the Brazos Valley
Bryan, TX

Julie Thomas, Executive Director
Volunteer Center of North Texas - Dallas, Ft. Worth, & Collin County
Dallas, Texas
(214) 818-9847
jthomas@vcnt.org

Carrie Moffitt, CEO
Volunteer Houston
Houston, Texas
(713) 964-0221
carriem@volunteerhouston.org

Wilfred Brewster
Killeen Volunteer, Inc.
Killeen, Texas
(254) 501-7878
wbrewster@ci.killeen.tx.us

Sharon Hyde Bass, Executive Director
Volunteer Center of Lubbock, Inc.
Lubbock, Texas
(806) 747-0551 x101
sbass@volunteerlubbock.

Sheila Miller, Executive Director
Volunteer McKinney Center
McKinney, Texas
(972) 542-0679
volunteermck@sbcglobal.net

Elizabeth Leyva
Round Rock Volunteer Center
Round Rock, Texas
(512) 733-7625
volrock@volrock.org

Kathy Graves, Executive Director
Texarkana Volunteer Center
Texarkana, Texas
(870) 773-8811
texvolctr@aol.com

Joyce Houston
Volunteer Center at United Way at San Antonio & Bexar Co.
San Antonio, Texas
(210) 352-7060
jhouston@unitedwaysatx.org

What types of Volunteer Management software exist? (August 2002)

The Association of Volunteer Administrators has a resource section on its website at www.avaintl.org. The Resource Section has a list of volunteer management software vendors, addresses, and websites.

In purchasing software, nonprofit organization should analyze their needs, evaluate computer and staff capabilities, research multiple vendors, and obtain references for any software product.

11118 Wurzbach Rd., Suite 303 - San Antonio, Texas 78230 - toll free phone (866) 875-7016 phone (210) 558-7016 - FAX (210) 558-7020 - info@txnetwork.org