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HOW TO INCORPORATE

New Words, Old Rules

Inc.'s editor-in-chief tells how a not-for-profit had to appear "helpless" for tax reasons.
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People in Washington, D.C., talk a lot these days about the "new accountability" demanded of not-for-profit organizations. Evidently, that does not mean they should be better managed or more attuned to the marketplace. One not-for-profit I know recently had its 501(c) application turned down by the Internal Revenue Service because the organization seemed a tad too businesslike. So it hired a lawyer experienced in the field, who redid the application to make the group (in his words) "appear less rigorous and more helpless." Lo and behold, the new application was approved.

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Last updated: Nov 1, 1995




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