Our church a non profit, wants to start a production co to reach at-risk kids. How should we proceed/set-up to avoid jeopardizing church’s 501c3?

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Our church a non profit, wants to start a production co to reach at-risk kids. How should we proceed/set-up to avoid jeopardizing church’s 501c3?

Asked on May 11, 2009 under Business Law, Nevada

Answers:

N. K., Member, Iowa and Illinois Bar / FreeAdvice Contributing Attorney

Answered 12 years ago | Contributor

It would be for the best interest of your organization if you secure a Board Resolution mandating the approval of your production project. A Board approval vouches for the true ‘non-profit’ nature as well as the integrity of an organizational agenda. If you are the project proponent, I would speculate that the Board may require you to justify your proposal. Such would perhaps include an assurance that all your activities remain compliant with the IRC Section 501(c)(3). Therefore, you should make sure that the “production” activities are directed toward charitable, religious, educational or other exempt purposes and free from any private interests. You may consult an attorney who is knowledgeable about all state nonprofit and charitable tax laws to which your organization is subject.


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