NAMI North Carolina Affiliate Tool Kit | Organizing for Success

Clearly, the best-run affiliates are almost always the ones that are the best organized. They have formulated bylaws, filed articles of incorporation and secured non-profit tax status. They have elected officers and appointed committees. They have developed policies and procedures and have plenty of volunteers in place to handle key affiliate functions, such as answering calls, holding meetings and collecting dues.

Bylaws

If your affiliate has not already done so, we encourage you to develop and adopt bylaws immediately. Sample affiliate bylaws are available the state office. We recommend using the sample as a framework for developing your own affiliate bylaws.

Incorporating Your Affiliate

By creating a separate legal entity for your affiliate, you lend legitimacy to your organization and make it eligible for non-profit tax status. Most charitable foundations require you to submit your articles of incorporation before considering your proposal for a grant. Incorporating your affiliate also shifts certain legal liabilities from individuals to the organization itself.

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Insert Your State’s Information Here

Sample Text from NAMI North Carolina:

Incorporation is a simple process requiring you to complete and file an “Articles of Incorporation—Nonprofit Corporation” form with the North Carolina Secretary of State’s office. The filing fee is $60, and help is available from NAMI North Carolina for affiliates unable to afford the filing fee. Normally, it takes a week to ten days for your form to be processed.

Sample forms and help with completing them are available from Beth Greb in the NAMI North Carolina office. To request forms, call the Secretary of State’s office at 919 733‑4201 or download them from the Secretary of State’s World Wide Web site at http://www.state.nc.us/secstate/.

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If your affiliate is already incorporated, you need to notify the appropriate state government agency and your NAMI state office any time you amend your articles of incorporation, change your principal office address or rename your affiliate.

Non-Profit Tax Status

Nonprofit corporations with charitable, educational, scientific, religious or cultural purposes have tax exempt status under section 501 (c) (3) of the Internal Revenue Code.

If your affiliate’s receipts are no more than $5,000 per year, donations you receive may be tax-exempt for the donor even without securing official tax-exempt status. However, many individual donors and nearly all grant-making foundations contribute only to organizations that have formally applied for and received tax exempt status. Non-profit mailing rates and some state and federal tax exemptions are available only to organizations with official tax exempt status.

Because of these many important advantages, NAMI urges you to seek tax exempt status—also known as 501 (c) (3) status—as soon as your affiliate is incorporated. Don’t wait for a donor to come along with a check before you file for 501 (c) (3). By then it will be too late to give your sponsor a tax break.

As a tax-exempt corporation, your affiliate may not endorse or oppose any political candidate. Your members may lobby legislators, but you may not spend more than 20 percent of affiliate income doing so. Since affiliates do not typically hire professional lobbyists, your lobbying costs should be well below the maximum. There are other important restrictions on what 501 (c) (3) can and cannot do. To avoid legal problems, be sure to contact the state office before you begin any fund raising activities.

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Insert Additional State Information Here

Sample Text from NAMI North Carolina:

Applying for a Solicitation License or an Amusement License

If your affiliate plans to raise more than $25,000 in contributions in a given year, you must apply for a Solicitation License. If your affiliate stages an event for which you charge admission, you must secure an Amusement License and pay a tax on gross receipts. Contact the state office for details.