4.
Re: How is a non-profit's owner determined? Apr 16, 2008 7:24 PM
in response to:
ZetaMonkey
I appreciate the acknowledgment, ZetaMonkey.
Whether you decided to initially form as a Delaware corporation or a Maryland corporation (or trust), you'd still need to register the organization in Maryland to operate as a non-profit there. Although some states require that non-profits have multiple board members, and some states do not allow non-profit board members to be compensated, Maryland does not appear to be one of those states -- it looks as though a non-profit there can have a single director and that the director can be compensated. So I think that answers your bottom line question.
A couple of things to keep in mind: Compensation must include a regularly paid salary, and the IRS states that the salaries of nonprofit directors must be in line with their duties and with salaries paid to other nonprofit directors in organizations of a similar size and scope in the same geographic location. So the non-profit organization will have to start paying your salary as soon as you begin work, and will be obligated (like any other corporation) to "make payroll" each pay period. The organization can't arbitrarily pay you less if funds are tight, nor can you just give yourself raises at will. Remember, a non-profit's tax returns are open to public inspection. No math is needed to see that the dollar amount on the "Compensation of Officers" line is what you're being paid. Plus, when you start fundraising, people (including donors, the media, and regulatory officials) will look closely to see how the organization spends its money -- and will be quick to raise concerns if anything looks questionable.
Here is a web link that should give you a lot of information to help you get started:
http://www.sos.state.md.us/Charity/Charit
yhome.htm
Best of luck!
