Non-Profit Dos and Don’ts Webinar Recap

The NJ Center for Non-Profits is the umbrella organization for all New Jersey 501(c)(3)s. Their mission is “to build the power of New Jersey’s non-profit community to improve the quality of life for the people of our state.”

Thank you to Debbie Duncan, Director of Member Services at the Center for Non-Profits, for presenting the webinar: Non-Profit “Dos and Don’ts”.

Debbie provided a wealth of information related to non-profit governance, board responsibilities, ways non-profits can develop their resources, and key issues currently facing NJ non-profits.

What is a Non-Profit?

Debbie began her presentation by addressing some misconceptions about what a nonprofit can and cannot do.

• Are charities permitted to charge fees for services? – Yes
• Are charities permitted to carry a surplus of funds from year to year? – Yes
• Are charities permitted to have paid staff? – Yes
• Are charities permitted to lobby for legislation? – Yes (with limitations)
  • Partisan activity is prohibited – Non-Profit Organizations CAN Lobby
• Do non-profits need an annual audit? – Sometimes (this depends on a number of factors, including annual budget size)

She then looked at what it means to be a “non-profit” at the state-level and a “tax-exempt” entity at the federal-level.  She also reviewed the various 501(c) designations made by the IRS, explaining that only contributions to 501(c)(3) organizations are tax deductible.

What regulations govern New Jersey non-profits?

Debbie provided an overview of the common reporting requirements non-profits have at the state and federal level.

Basic Filing & Reporting Requirements for Non-Profits

Debbie then went on to summarize some regulations in NJ Statute Title 15-A, the statute that governs nonprofit corporations in NJ.  These include that a nonprofit corporation must have:

• a minimum of 3 trustees, who are 18 or older and serve a term of 1-6 years
• a “registered agent” in NJ
• articles of incorporations and bylaws that govern the organization
• a President, Secretary, and Treasurer
• elections held every 2 years

What are the responsibilities of a non-profit’s board?

As Debbie emphasized, no one owns a non-profit corporation.  A non-profit’s board of trustees is responsible and accountable for all aspects of its operation.

Debbie recommended that all trustees be aware of:

• The IRS Requirements for non-profits
• NJ Statutes governing non-profit corporations – Title 15A: New Jersey Nonprofit Corporation Act
• Federal and State Reporting Requirements
• The non-profit’s articles of incorporation – request a copy through NJ’s Division of Revenue and Enterprise Services
• The non-profit’s bylaws

How can non-profits develop their resources?

In terms of financial resources, Debbie described a variety of revenue streams including individual donations, corporate funding, foundation grants, and government grants/contracts.

Debbie also emphasized how fees for service income can be a major source of revenue for nonprofits.  See the graph on page 19 of the following National Council of Nonprofits report:

Nonprofit Impact Matters:  How America’s Charitable Nonprofits Strengthen Communities and Improve Lives (2019)

In terms of human resources, Debbie discussed the importance of staff and volunteer development, the use of in-kind gifts, and how nonprofits can partner to share services.

More Information

Visit the Center for Nonprofits website to learn more about:

• New Jersey’s nonprofit community
• Research publications
• Forming a new non-profit
• View the presentation’s slides (PDF)

More nonprofit-related resources are available at the New Jersey State Library through our Funding Information Center.