Can you create a charity that donates to other charities?

Yes, you can start a non-profit that contributes to other non-profits. Like others pointed out, you may want to take some time and think about whether you really need to put together a non-profit to do what you’re wanting to do. Another suggestion was starting a foundation. However, creating a foundation could be done as a 501(c)(3) or even a charitable trust. One thing to consider, regardless of how you wish to proceed, is that there will still be laws and regulations that you’ll have to ensure are followed. You’ll also have to be prepared to operate the non-profit or foundation, gain the interest of donors, and look for other sources of funding (such as grants).

It can take both time and money to set up a non-profit or charitable trust. So, another option you may also want to consider that’s been mentioned is to work directly with charities that interest you. You could even do things in your own community to raise money and then donate that money to the organization of your choice.

Yet, if starting a non-profit is something that you really want to do, then you can certainly do that. First, you’ll need to think about what you’d like to call your non-profit. You’ll need to do a name search on the Secretary of State website for your state. What you’re looking to see is if the name you want is taken or if it is so similar to another business or non-profit that people could confuse your entity for theirs. Once you’ve settled on a name, you will need to download and complete the proper forms in your state to create your 501(c)(3). It is very, very important that the documents are accurately completed because your information can affect your tax-exempt status. And that’s the next important thing – you also have to apply for tax-exempt status through the IRS. Then, you need to check with your state tax agency to make absolutely sure that your organization is tax-exempt and also that you don’t need any special permits or licenses. You also need to write bylaws and have a board of directors who will meet and adopt those bylaws.

As you’ve read from all of us, it’s possible, but it is a lot of work. It would also be very rewarding if that is the path you want to take. You might want to talk with an attorney to make sure that this is the best path for you to take to make a difference. LawTrades provides affordable access to attorneys who can answer your questions. We’ve helped thousands of people start businesses and non-profits and we’d love the opportunity to answer your questions!