Are there advantages to being non profit for 10 months or less?
Dear Sheryl –
Thank you for writing to us at the Community Tool Box with your important question.
If you are collecting money for a cause such as you describe, your organization does not need to be a formal nonprofit. We have ourselves belonged to several successful organizations that collected and managed money, and did not have nonprofit status at all.
However, there are certain advantages to becoming a legal nonprofit, even for a short period. Perhaps most importantly, it will give you more credibility in the eyes of some potential donors, and perhaps of the media and general public. You may better be able to get discounts, as you suggest. It will oblige you to have officers, and to meet other formal though simple-to-meet requirements, which may in fact encourage you to keep going when you might otherwise have folded. And should you ever want to apply for IRS tax exemption as a 501 (c) (3) organization (a separate process), having prior nonprofit status would be required.
To apply for nonprofit status is not usually difficult. Laws vary from state to state, so you should check your own. Someone in an existing nonprofit could help you file, if you choose to go that way. And your local bank could give you advice on how to set up a nonprofit (or other) account—note that local bank policies may vary here too. In addition, Chapter 43, Section 4 of the Tool Box will give you some more detailed general advice about these issues.
We hope some of these points may be helpful to you. Thanks again for bring in touch with us, and all very best wishes for success in your work.