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Nonprofit regulation in Wisconsin
 in Wisconsin |
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Nonprofit regulation in Wisconsin involves a complex set of rules that govern nonprofit organizations and charitable giving throughout the state. Major issues surrounding nonprofit regulation nationwide include the following:
- contribution limits,
- donor disclosure, and
- the redefinition of issue advocacy.
Wisconsin is one of 39 states that require charitable organizations, and those intending to solicit on their behalf, to register with the state in order to solicit contributions, whether they are a Wisconsin organization or based out-of-state. In Wisconsin a number of groups and organizations are exempt from registration.[1]
Wisconsin is one of 32 states that allows registrants to use either the Unified Registration Statement (URS) or the state registration form.[2] Only seven states requiring registration do not accept the URS.
- Note: The following is not a how-to guide in managing an organization's registration and reporting requirements, but rather an attempt to share information about the relative degree of regulation governing nonprofit charitable activity at the individual state level. The information on this page was last updated in early 2015.
Background
According to the Foundation Center, there are over 1.5 million nonprofit organizations in the United States.[5] Section 501 of the U.S. tax code outlines which types of nonprofit organizations may be granted tax exempt status by the Internal Revenue Service. The section of this code that provides for exemption is section 501(a), which states that organizations are exempt from some federal income taxes if they fall under sections 501(c) or 501(d), or under section 401(a).[6]
Organizations classified as 501(c)(3) are nonprofit charitable, religious and educational organizations. These include organizations like the Red Cross and Habitat for Humanity as well as the American Civil Liberties Union and the Lucy Burns Institute, which provide, as defined in the federal code, “instruction of the public on subjects useful to the individual and beneficial to the community.”[7] Organizations granted 501(c)(4) status are political education organizations, and can engage in political lobbying. This includes donations to political committees that support or oppose ballot measures, bond issues, recalls or referenda. 501(c)(4) organizations can thus engage in issue advocacy, but they are not allowed to expressly advocate for the election or defeat of a particular candidate.
While the Internal Revenue Service designates eligible nonprofit charitable organizations with a federal tax exempt status, individual states require their own level of regulation and reporting, particularly when organizations attempt to solicit fundraising contributions. The amount of regulation required differs by state, as does the degree to which state regulations protect the privacy of individual donors. Three states, for instance, require annual copies of IRS Form 990 (schedule B), which lists individual contributors who contribute over a specified amount. Research shows that attempts to make contributions more transparent has an unintended negative effect on the number of contributors who give, as well as the amount.[4]
Governing agencies
The Wisconsin Department of Financial Institutions is the authority in the state that oversees rules governing donor solicitation and registration.
See law: Chapter 202, Subchapter I and II, Stats
Registration requirements
Any nonprofit group or organization located in Wisconsin, unless exempt, must register with the Wisconsin Department of Financial Institutions. Any non-exempt nonprofit, in any state, intending to solicit in Wisconsin must also register, along with anyone intending to solicit in Wisconsin on behalf of a nonprofit. Non-exempt nonprofits might include traditional charitable organizations like the Red Cross or Habitat for Humanity, educational or policy organizations like the American Civil Liberties Union, or issue advocacy groups like the League of Conservation Voters.
Exemptions
A number of groups are exempt from registering in Wisconsin. The following are exempt from registration:[1]
- Candidates for national, state or local office or a political party or other committee or group required to file financial information with the Federal Election Commission
- Organizations that do not raise or receive contributions in excess of $5,000, if all functions are performed by persons who are unpaid
- Fraternal, civic, benevolent, patriotic or social organizations that solicit contributions solely from their membership
- Veterans' organizations
- Nonprofit post-secondary educational institutions
- Any person soliciting contributions for the relief of a named individual, if all contributions are given to the named individual
Procedures
Nonprofits registering in Wisconsin can use either the Unified Registration Statement (URS) form or the state form.[1]
Documents
The following documents are required along with your registration form:[1]
- Articles of incorporation
- Bylaws
- If out-of-state, a certificate of incorporation issued by the home state
- IRS determination letter, if the organization has one
- A statement about how the organization will use contributions
Signature and fee
Two signatures, one of the president or another authorized officer, and another of the Chief Financial Officer, are required. Signatures must be notarized.
The registration fee is $15.[1]
Filing procedures
Registration materials must be mailed to:[1]
Wisconsin Department of Financial Institutions
PO Box 7876
Madison, WI 53707
Renewal
Organizations must renew their registration each year, and must do so by July 31. The renewal fee is $54.[1]
Financial reporting
Any registered organization that receives more than $5,000 during the fiscal year must file an annual financial report. Reports are due within nine months after an organization's fiscal year ends. Depending on the organization, there are three different forms they must use:
- Form 1943 Affidavit in Lieu of Annual Financial Report can only be used if an organization received less than $5,000 during the fiscal year, or if it solicited only in the county in which it is located and received less than $50,000 in contributions.
- Form 308 Charitable Organization Annual Report can be submitted without a copy of the IRS Form 990.
- Form 1952 Wisconsin Supplement to Financial Report is most commonly used, being most similar to the first page of the IRS Form 990 and shorter than Form 308. A 990 must be submitted along with this form.[1]
Recent news
This section links to a Google news search for the term "Wisconsin + donor + privacy"
See also
External links
Footnotes
- ↑ 1.0 1.1 1.2 1.3 1.4 1.5 1.6 1.7 Fishman, S. & Barrett, R. (2012). Nonprofit Fundraising Registration: The 50 State Guide. NOLO.
- ↑ "Multistate Filing Form," accessed December 17, 2014
- ↑ Guidestar, Fundraising: What Laws Apply?" accessed February 18, 2015
- ↑ 4.0 4.1 London School of Economics, "Campaign finance laws that make small donations public may lead to fewer people contributing and to smaller donations," January 7, 2015
- ↑ Foundation Center, "Frequently Asked Questions," accessed December 17, 2014
- ↑ Cornell University Law School, "26 U.S. Code § 501 - Exemption from tax on corporations, certain trusts, etc," accessed January 13, 2015
- ↑ Cornell University Law School, "26 CFR 1.501(c)(3)-1 - Organizations organized and operated for religious, charitable, scientific, testing for public safety, literary, or educational purposes, or for the prevention of cruelty to children or animals," accessed January 13, 2014
