Nonprofit regulation in Kansas
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Nonprofit regulation in Kansas 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.
Kansas 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 Kansas organization or based out-of-state. In Kansas a number of groups and organizations are exempt from registration. These groups are not required to apply for exempt status; it is automatic.[1]
Kansas 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 Kansas Secretary of State is the department in the state that oversees rules governing donor solicitation and registration.
See law: Kansas Statutes Annotated sections 17-1760 through 17-1776
Registration requirements
Any nonprofit group or organization located in Kansas, unless exempt, must register with the Kansas Secretary of State. Any non-exempt nonprofit, in any state, intending to solicit in Kansas must also register, along with anyone intending to solicit in Kansas 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.[1]
Exemptions
A large number of groups are exempt from registering in Kansas. These groups are not required to apply for exempt status; it is automatic.
The following groups are exempt from registering:[1]
- Any organization receiving less than $10,000, if they only have unpaid fundraising volunteers
- Any organization receiving contributions from less than 100 people during the year
- Religious groups
- Educational groups; libraries too, if they file annual financial reports with a state agency
- All nonprofit licensed medical care facilities
- Membership groups
- Appeals for single individuals, assuming all money goes to that person
- Incorporated community chests and United Way
- Public foundations
- Any charitable group whose funds are used to support any activity of a Kansas municipality
- Volunteer firefighters
- The junior league
- Boy and Girl Scouts
- YMCA/YWCA
- Any corporation established by Congress that is required to file annual itemized financial reports after being audited
Procedures
Nonprofits registering in Kansas 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]
- IRS Form 990 from preceding year (if an organization does not have an IRS Form 990, then it must complete the state financial form, Form FS)
- If an organization received more than $500,000, then it must include an audited financial statement and an opinion letter prepared by a Certified Public Accountant
Signature and fee
Two signatures are required; one must be the Chief Financial Officer's. Signatures do not need to be notarized.
The registration fee is $35.[1]
Filing procedures
Registration materials must be mailed to:[1]
Kansas Secretary of State
Ron Thornburgh Memorial Hall, 1st Floor
120 S.W. 10th Avenue
Topeka, KS 66612
Renewal
Registration expires on the last day of the sixth month following the month in which your group's tax year ends. Organizations can renew using the same form required for initial registration, or the URS. There is a $35 dollar renewal fee. While no extensions are granted, there is no late fee.[1]
Financial reporting
Organizations must annually provide an audited financial statement if they received more than $500,000 during the year. All other requirements for annual financial reporting are the same as those of initial registration.[1]
Fee
There is no additional fee beyond the annual $35 renewal fee.[1]
Recent news
This section links to a Google news search for the term "Kansas + donor + privacy"
See also
External links
Footnotes
- ↑ 1.0 1.1 1.2 1.3 1.4 1.5 1.6 1.7 1.8 1.9 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
