05-05-2013, 05:46 AM
Carey's right about that. The IRS requires that your bylaws have a dissolution clause that reads: "Upon dissolution of the organization, assets shall be distributed for one or more exempt purposes within the meaning of section 501©(3) of the Internal Revenue Code, or corresponding section of any future federal tax code, or shall be distributed to the federal government, or to a state or local government, for a public purpose."
So it's not only equipment - it's ALL assets. Your bylaws can go on to detail if you want certain percentages or items to go to different entities. If they go to a nonprofit named in your bylaws, that nonprofit has to have the same or similar or overlapping exempt purpose. If it goes to a government agency, you can specify an agency that has a similar kuleana as your nonprofit.
Forgot to mention: you should have your bylaws prior to applying for the State Domestic Nonprofit status.
So it's not only equipment - it's ALL assets. Your bylaws can go on to detail if you want certain percentages or items to go to different entities. If they go to a nonprofit named in your bylaws, that nonprofit has to have the same or similar or overlapping exempt purpose. If it goes to a government agency, you can specify an agency that has a similar kuleana as your nonprofit.
Forgot to mention: you should have your bylaws prior to applying for the State Domestic Nonprofit status.