Forming a Nonprofit Corporation
Nonprofit, charitable organizations are an important aspect of life in New Mexico
providing education, social services, arts, help to the disadvantaged, and other
services to support our communities. Such organizations also employ thousands
in New Mexico adding to the overall health and growth of the State.
While forming a nonprofit organization is not typically a complicated process, it
can be time consuming. The information listed here is not intended to be all
inclusive, but to provide general information and cannot replace the help of an
attorney or accountant.
Starting a Charity FAQ
- What is the definition of a Charitable organization?
- What's the difference (if any) between a Non-profit Organization and Charitable
Organization?
I'd like to start a non-profit org, what are the first few steps of the process?
- Where can I find relevant laws or regulations?
- Do I have to file with the Attorney General’s office?
- I think I’m exempt from registering with the Attorney General’s office,
how do I check?
- Additional resources.
What is the definition of a Charitable Organization?
As outlined in the Charitable Solicitation’s Act, a "charitable organization"
means any entity that has been granted exemption from the federal income tax by
the United States commissioner of internal revenue as an organization described
in Section 501(c)(3) of the Internal Revenue Code of 1986, as amended, OR identifies
itself to the public as having a charitable purpose.
What's the difference (if any) between Non-profit Organization and Charitable
Organization?
- Under the Internal Revenue Code (IRC), there are approximately 25 categories of
nonprofit organizations.
- One of these categories, 501(c)(3), is described as charitable organizations, to
which donations made are tax-deductible on the donor's income tax return.
- In New Mexico, to qualify as a non profit corporation, no part of the income or
profit may be distributable to its members, directors or officers. The corporation
is formed by filing articles of incorporation with the
New Mexico Public Regulation Commission-Corporations Bureau .
I'd like to start a Non-profit Organization, what are the first few steps of
the process?
Where can I find relevant laws or regulations?
Do I have to file with the Attorney General’s Office?
If your organization identifies itself to the public as having a charitable purpose
and is not exempt from registration, it probably has to register regardless of it’s
501 status. Charitable purpose means a benevolent, social welfare, scientific,
educational, environmental, philanthropic, humane, patriotic, public health, civic
or other eleemosynary objective or an activity conducted in support of or in the
name of law enforcement officers, firefighters or other persons who protect public
safety.
If in doubt, send us a quick email and we’ll work with your organization to
determine it’s registration requirements.
Char...(click to show)...@nmag.gov.
I think I’m exempt from registering with the Attorney General’s office, how
do I check?
We ask all organizations that believe they are exempt from registration send in
an exemption request and the organization’s by-laws. We will then send
an exemption letter for your file. This will allow our office to maintain accurate
information on the organization. Exemptions include:
- Religious organizations are exempt so long as the primary purpose of the entity
is religious in nature. Religious organization means a church, organization
or group organized for the purpose of divine worship or religious teaching or other
specific religious activity or any other organization that is formed in association
with or to primarily encourage, support or promote the work, worship, fellowship
or teaching of the church, organization or group.
- Educational institutions are exempt from registration. Educational institution means'
(1) an entity organized and operated primarily as a school, college or other instructional
institution with a defined curriculum, student body and faculty, conducting classes
on a regular basis; and (2) auxiliary entities, including parent-teacher organizations,
booster and support clubs that support, encourage or promote a school, college or
other instructional institution and its defined curriculum, student body, faculty,
facilities or activities. All auxiliary entities must be under the supervision
of the educational institution to receive exemption.
- Persons soliciting for an individual or group that has suffered a medical or other
catastrophe is also exempt so long as (a) the individual or group is identified
by name at the time of the solicitation; (b) the purpose for the solicited
contribution is clearly stated; and (c) the gross contributions collected, without
any deductions for or by the solicitor or any other person, are deposited directly
to an account in the name of the individual or group in a local federally insured
financial institution established for that sole purpose and solely used for the
direct benefit of the named individual or group as beneficiary.
Additional Resources
- Establishing a Nonprofit Corporation by the
Foundation Center.
- Starting a Non-Profit Organization: A
Resource List
- National Association of State Charity Officials aka
NASCO.
- Independent Sector
- The New Mexico Attorney General’s Office - Charity Unit 505-222-9046
- The Public Regulations Commission 1-888-4ASK-PRC (1-888-427-5772)
- New Mexico Taxation and Revenue (505) 827-0700