The Limitations of a Religious Nonprofit

If you are starting your own religious nonprofit organization, you may believe much of your legal and financial trouble is over once you’ve received your tax-exempt nonprofit status. However, things aren’t that simple, because your nonprofit status is conditional on meeting certain basic requirements. And if you’re not careful and run afoul of the limitations on religious nonprofit corporations, your nonprofit status, and all its advantages, could be put in danger. Continue reading “The Limitations of a Religious Nonprofit”

Free Exercise of Religion by Closely Held Corporations

The First Amendment of the United States Constitution states that “Congress shall make no law respecting an establishment of religion, nor prohibiting the free exercise thereof.” While it is obvious this applies to natural persons (in other words, living human beings), the Supreme Court ruled in Burwell v. Hobby Lobby Stores, Inc. that, in some cases, it can also apply to closely held corporations. Although it has been half a decade since the case was decided, the exact implications of Hobby Lobby remain loosely defined. Continue reading “Free Exercise of Religion by Closely Held Corporations”

What Does it Mean to Be Tax-Exempt?

Tax-exempt charitable corporations are a surprisingly common part of American life. Most churches, colleges, libraries and charities are organized as tax-exempt charitable corporations, free from the burden that an income tax imposes on most people and businesses. However, being tax-exempt doesn’t mean you’re entirely free of obligations, and if you’re not careful, your tax-exempt corporation could find its status stripped, exposing it to massive financial liability. Continue reading “What Does it Mean to Be Tax-Exempt?”

Can a For-Profit Corporation Claim a Religious Objection?

It has long been recognized in the United States that an individual can, under certain circumstances, claim religious exemptions to certain laws because of a religious objection. This basic principle, based on the First Amendment’s Free Exercise clause, has also been extended to religious non-profit organizations, like churches and schools or charities run by religious institutions. However, in recent years a new question has come up: can a for-profit company claim a religious objection to a law, even when they’re not officially recognized as a religious organization? Continue reading “Can a For-Profit Corporation Claim a Religious Objection?”

Prohibited Activities by Nonprofit Organizations

Operating a nonprofit corporation can give you a lot of freedom compared to operating a for-profit corporation. For one, you can simply do whatever your organization was created to do, without worrying about whether you’re pleasing shareholders. For another, you can get a tax-exempt status that will protect you from the burden of the corporate income tax. However, that status isn’t absolute, and if you engage in any prohibited activities, your nonprofit status can be revoked. Continue reading “Prohibited Activities by Nonprofit Organizations”

Is a Nonprofit Corporation Right for You?

When people think about corporations, a few names will spring to mind: Disney, McDonalds, Walmart, Coca-Cola, Apple, maybe even something like Comcast or Nintendo. And that’s because most people only really think about for-profit corporations. However, just about every major charity is also incorporated, as are many colleges and universities. The big difference is that these are nonprofit corporations, and depending on what you intend to do, a nonprofit corporation might be just what you need. Continue reading “Is a Nonprofit Corporation Right for You?”

The Obligations of Incorporation

If you choose to incorporate your business or organization, you may think the worst of it is filing the articles of incorporation (or, of course, filing your taxes). You may think your corporation protects you from financial and legal liability. However, corporations have additional requirements that other kinds of businesses don’t, and if you’re not diligent about fulfilling them, there can be serious legal consequences. Continue reading “The Obligations of Incorporation”

The Rights of Shareholders

Many people buy and sell stock in companies every day, but most of them are more interested in the short-term profit to be made from trading stocks, rather than the rights they gain from owning those stocks. However, if you’re a long-term investor, or just someone interested in corporate governance, it can be helpful to know what those stocks give you, aside from some cash when they’re sold on the stock market. Continue reading “The Rights of Shareholders”

Corporate Personhood, Explained

Some people have joked about the idea of corporations being people. It sounds like a ridiculous enough statement, and on its face, it is; a business is not a human being, no matter how generously you stretch the definition of either. However, legally speaking, it’s true that corporations are people (sort of), and if you’re running your own corporation, it can help to understand how corporate personhood works. Continue reading “Corporate Personhood, Explained”

Incorporation: Should You Register In Delaware or New York?

When starting a business, incorporation can be an exciting step. But when taking this step, many individuals may ask whether incorporating in Delaware is more advantageous than New York. The real answer is “it depends.” Knowing the difference between the incorporation processes of the two states is important in making that decision. Businesses differ, so weighing the pros and cons of each state will help you find the right venue to register in.

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