Philadelphia, PA asked in Business Law and Gov & Administrative Law for Pennsylvania

Q: PA registration for a nonprofit bringing in less than $25k annually in contributions.

I spoke with a clerk at the Charities division of the Pennsylvania Department of State who told me that because our nonprofit brings in less than $25k in annual contributions, we’ve actually never even come close with $8k being the most, we do not need to register or file with the state of PA until we either pay someone to solicit contributions or until we bring in more than $25k in annual contributions.

While I find this surprising, I’m hoping someone can confirm the statement is in fact true.

Since our organization does not pay anyone to solicit contributions and since we have never exceeded annual contributions of even $8k that would mean we would probably never need to register or file in PA.

Being a recently domesticated npo from California, this seems a bit odd to me.

Any and all consideration in responding is greatly appreciated.

1 Lawyer Answer

A: There are two things going on here, and because Pennsylvania deals with them a bit differently than California does, it is a change to what you are used to.

All states have some form of keeping track of the corporations and other business entities that are based in their state. That applies to for-profit corporations, nonprofit corporations (which are called not-for-profit corporations in some states), limited liability companies (LLCs), and maybe some others (like partnerships) depending on the state. In Pennsylvania, the office that cares about keeping track of all the corporations is the Department of State, specifically the Bureau of Corporations and Charitable Organizations. It was the Secretary of State that played this role when you were in California.

Most states have additional state regulations to keep track of what charities are doing in their state. (Not all "nonprofits" are "charities," but that is a different topic.) In Pennsylvania the Charities Section of the Bureau of Corporations and Charitable Organizations keeps tabs on what charities are doing in the state. Like many states, Pennsylvania only requires charities to register with that section once they reach a certain size or do certain things. It sounds like you are not there yet. Back when you were in California, the equivalent state office was the Attorney General's Registry of Charitable Trusts. Unlike Pennsylvania, the California AG's office requires charities to register with the RCT within thirty days of receiving their first dollar of charitable donations.

It sounds like what you heard from the Department of State was about the requirement to be regulated by the Charities Section. Your organization is still required to register as a nonprofit corporation with the Department of State, just as any corporation (for profit or nonprofit) must do.

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