Recognizing the complicated labyrinth that is the multi-state charitable solicitation registration process, a new organization called the Multistate Registration and Filing Portal, Inc. has been formed as a Delaware nonprofit corporation (“MRFP”). The MRFP is working with the National Association of States Charities Officials and the National Association of Attorneys General to develop an online system that will permit nonprofits and professional fundraisers to comply with all states’ registration and annual filing requirements through a single portal.
From time to time we see nonprofit clients adding employees in states in which they haven’t operated before. Often it is just one employee, perhaps a development person working from their home or a shared workspace. Although hiring an employee in another state may not seem like a significant event, many businesses don’t realize that it triggers several compliance obligations.
Arizona House Bill 2457 repeals Arizona’s solicitation registration laws and does away with the need for Arizona charities to file annual Charitable Organization Registration/Renewal forms with the Arizona Secretary of State.
The major driving force behind becoming a tax-exempt nonprofit is the ability to solicit tax-deductible donations; yet, too many nonprofits planning to conduct any form of organized fundraising are unaware of their state’s registration laws.
Forty-one U.S. states as well as the District of Columbia and many local jurisdictions require some type of registration for charities trying to solicit funds. These laws create a patchwork of largely inconsistent laws that nonprofits must contend with. To add to the confusion, the jurisdictions that require registration have different definitions and standards regarding who must register, which documents are required, whether nonprofits must renew their registrations, and which government agencies process the registrations.