Nonprofits Losing Their Status

Yeah, this is, uh, we usually come to you live on Thursdays, but today is Friday because Vanessa was at a conference. Vanessa, you want to tell us just a little bit about the conference?

Oh my goodness, it was a huge conference. It was put on by SAMHSA, the Substance Abuse Mental Health Administration, Service Administration, and I love it because they fund a lot of programs throughout the country, and they funded our organization to do some trauma work. And so it was mandatory for all of us to go, and it was over 600 people, I believe, um, and so many organizations there just coming together, just really discussing racism, equity, trauma. It was really— it was good.

Excellent.

So I'm just getting back in.

So today we're going to talk to you about, um, losing your nonprofit status.

You know, a lot of nonprofits lose their nonprofit status. You know, from 2010 to 2017, the middle of 2010 to the, to the end of 2017, that's 7 years. Over 760,000 nonprofits lost their nonprofit status. Yeah. Wow.

So tell us some things that, uh, will cause a nonprofit to lose their nonprofit status.

Um, one of them is, um, not following, filing their annual reports are their, their 990, 990-N. That will definitely do it. And I know a lot of organizations are not really familiar with it, and I want to talk about why I believe it is. Um, they lose it for doing lobbying, because that's one of the things that nonprofits are not supposed to be doing is lobbying. Um, they are doing, um, of course, political activities, and there's so many different things that they can do. It's as easy as it is to get your nonprofit you can lose your nonprofit status. Doing unrelated, um, business activities, you know, doing things that's, that's just so they could— so they're using their nonprofit as maybe a flow-through and doing things that does— that's not in line with their nonprofit status. So there's different reasons why, but I think the most of them, well, lost their nonprofit status because they're not filing their forms. And I think that might be because A lot of nonprofits do not do their own paperwork. And so, and I think that goes to us being afraid of the IRS. You know, whenever we have to deal with the IRS, talk about the IRS, we all have these negative connotations, these negative feelings, and stuff, upset stomach, and I know headache and stress, you know, all those different things. We talk about the IRS. So a lot of nonprofits, they get somebody else to do their paperwork so they don't have to deal with it. And so when something happens down the road, they don't know anything, they don't have a clue what's going on, and then they have to file these forms, but they never knew anything about it because they, they stick their hand, their hand in it. Is that the duck? Isn't the duck what stick their head in the sand? No, that's an ostrich, because the duck is someone that wants to know what the duck is going on, right?

Right. The duck is in the business, in the business.

They want to know what is going on.

Yeah. So I'm also thinking that this is something that's covered in the Nonprofit Founders Club, because one of the things that we stress is hands-on in all aspects of your nonprofit. Because, you know, like, it's not an original saying, but the buck stops with you. The buck stops with the founder. So if the founder isn't aware of what's going on with the organization, then that's a problem.

It's a problem. Because a lot of times you get board members, and the board members, they don't know they're volunteering because they want to help you. You've got to know because you need to go back and you need to tell them, or even be able to empower them to look, you know. But we don't. We're like, we stick our head and say, let's find an attorney so they could do our paperwork for us, let's find a friend who could do it for us. Oh, I don't need to know. Oh, I got my nonprofit status. And then what, right? Right. And then 760,000. And that's 760,000 people that said, you know what, I want to make a difference in this world. And not saying that they didn't get their status back, but that's more paperwork. That's more that they're taking away from them doing what they need to do.

More paperwork. And we shouldn't forget to add more money to—

more money. Yeah, that's right. That's right. So, and I'm with this. Let's do it. Let's get it. Let's get it done. And even learn, even if you don't get it right the first time, learn. Get in there and learn it because the IRS is going to be with you throughout the life cycle of your nonprofit. And after your nonprofit is gone, they still may be— they still may be in your life, you know. So you need to really kind of get comfortable with them. You're never going to get that comfortable. I've been doing this like, you know, for 35 years. I never get comfortable with it. Every time I get a letter in the mail, I'll be like, what the duck?

That letter from the IRS, you know, what do they want?

You know, you never stop, but at least you, you can kind of, um, head on with them, and then you can hold an intelligent conversation and you have some idea what they're talking about.

And one thing that, um, speaking of the IRS, that people should just know: the IRS is never going to call you. Never ever are they going to call you. Always, always the IRS is going to write you, but they're not going to call you. And if they call you, it's to let you know something, but they're not calling you for information. They're always going to send it to you in writing. Um, The, the last thing that I think we should just mention here is Nonprofit Founders Club is, um, very serious. We don't duck around about, um, the foundation of your nonprofit. So in October, there's going to be a course on, um, essentials, the essentials. I forget what we called it. It's the Nonprofit, um, Startup clinic. And then we also have the club that goes through the essentials. I mean, like, these are the bare-bones things you should be doing after you have, um, secured your 501, or even while you're waiting for your 501. These are the things that you should be doing. But it's just good for everyone to know that the Nonprofit Founders Founders Club is there for you from A through Z.

Yes, yes, yes, yes. Because we need, we need that support. You know, it's, it's funny to go back to this, the event that I was at. Even when you're no longer funded from SAMHSA, you still can be a part of that network. And so many people are affiliates and part of that network because we need that support. And that's where the Nonprofit Founders Club comes in. We have that support. Yeah, so, and we got some special things coming up. I am so excited. So, um, if anybody's looking at this now or they're— they look at it down the road, keep an eye because we have some wonderful things coming up to help out in this world, man. I'm gonna cut here and then I'm just gonna say this. All over the world there are so many problems, there's so much going on, there's so much need. And then at this— I was at this conference and there's so many people that's— it was a drop in the bucket— was out here trying to solve this need. And then you look at the 760,000 people who lost their nonprofit that's trying to solve some of the problems. There is so much need. I was in Maryland, and I'm going to use Maryland because that's where I was, I was recently. And you look out and you see the people that are homeless, people that are addicts, people that— there's so much going on. And you look and they're so— I've seen a lot of blight. You know, beautiful hotel— beautiful hotels, beautiful businesses that was started, but now there's no one there, right? They're all closed down. Is it because of COVID Is it because the recession? Is it because some— they lost their liquor license? There were so many different reasons. But as I was looking out at that, I was thinking, you know what, if, if I was a nonprofit in this city, I would go and I would find out who is the owner. But there's two problems here. I want you guys to think of this real quick. I know we're going over, but there's two problems here. I was looking, I was saying, you know, I would go to the owners of this, this complex, and I would say, hey, we're nonprofit, could you give us discounted space? We're going to bring support services into your— into this building, right? And use it for an event maybe, or use it for office space to build my nonprofit. But then on the flip side, people are like, we don't want that in our community, not in my backyard, we don't want you bringing all of your stuff into— we don't want more homeless people, we don't want more addicts, we don't want that into our community. So we have two different things going on. Yeah.

So, yeah, so sadly what you just said too is people sometimes equate nonprofits with helplessness, people who are helpless. And nonprofits can— I mean, you know, they can be there for all kinds of reasons, you know. So yeah, so it's too bad. It's really too bad.

Yeah, we had a lot— we have a lot to talk about. So this was good. So I enjoy talking with you and we get a chance to just talk about what's going on. And, uh, yeah. So everybody, if you're watching us live or if you watch this in the future, get out there and figure out what the duck is going on. This is our new mascot. This is our girl. Anybody have a name that they would like to think we should name her? Go ahead, put in the chat box, let us know, and we'll consider your name. But this is our girl. We, we always try to figure out what the duck is going on and get your ducks in a row and build your nonprofit. Alrighty, end stream. Thanks everybody.