Charitable Organizations Frequently Asked Questions
Charitable Organization Registration FAQs
- What is a Charitable Organization?
- When does a charitable organization need to be registered in Wisconsin?
- What is a charitable purpose?
- What is a contribution?
- What does it mean to solicit?
- What is a solicitation?
- May a licensed charity accept a contribution from an unlicensed raffle?
- Are there any prohibited acts?
- Is my charitable organization exempt from registration?
- Does my organization need a special permit to conduct a raffle or to hold a bingo event?
- I already paid a $10 registration fee to the Department of Financial Institutions, why am I being asked to pay an additional $54?
- Are there any other Wisconsin state agencies or federal government agencies that my charitable organization may have to register with?
- Must I notify the department before using a new trade name (doing business as name)?
Charitable Organization Annual Report FAQs
- Are Charitable Organizations required to file an annual report?
- Why must I file an annual report?
- When must I file my annual report?
- What form should I file my annual report on?
- Do I need to submit financial statements with my annual report?
- Can the audited financial statement requirement be waived?
- Is there a fee to file an annual report?
- Is there a difference between an annual report and a registration renewal?
- Who should I contact with technical questions about the Charitable Organization Annual Report Form #308?
Charitable Organization Registration FAQs
What is a Charitable Organization?
Pursuant to s. 202.11(1), Stats., any organization described in section 501(c)(3) of the internal revenue code that is exempt from taxation under section 501(a) of the internal revenue code qualifies as a charitable organization and a person who is or purports to be established for a charitable purpose also qualifies as a charitable organization. A link to the Internal Revenue Code can be found here .
When does a charitable organization need to be registered in Wisconsin?
Pursuant to s. 202.12, Stats., a charitable organization needs to be registered if it solicits in Wisconsin or has contributions solicited in Wisconsin on its behalf.
What is a charitable purpose?
Pursuant to s. 202.11(2), Stats., a charitable purpose is either a purpose described in section 501(c)(3) of the internal revenue code, or a benevolent, educational, philanthropic, humane, scientific, patriotic, social welfare, advocacy, public health, environmental conservation, civic, or other eleemosynary objective.
What is a contribution?
Pursuant to s. 202.11(5), Stats., a contribution is a grant or pledge of money, credit, property, or other thing of value, except food, used clothing or used household goods, given to a charitable organization. A contribution does not include income from bingo or raffles, a government grant, or a bona fide fee, due, or assessment paid by a member of a charitable organization, except that if initial membership in a charitable organization is conferred solely as consideration for making a grant or pledge of money to the charitable organization in response to a solicitation, that grant or pledge of money is a contribution.
What does it mean to solicit?
Pursuant to s. 202.11(8), Stats., solicit means to request, directly or indirectly, a contribution and to state or imply that the contribution will be used for a charitable purpose or will benefit a charitable purpose.
What is a solicitation?
Pursuant to s. 202.11(9), Stats., a solicitation is an act or practice of soliciting, including any of the following: an oral or written request, an announcement to the news media or on the radio, television, telephone, or telegraph, or the distribution or posting of a handbill or other written publication. It also includes any advertisement, book, card, tag, or other tangible item that requests financial support, uses the name of the organization as a reason for making a purchase, or says that a portion or all of the proceeds from the sale will benefit a charitable organization.
May a licensed charity accept a contribution from an unlicensed raffle?
There is no rule governing the acceptance of a contribution from an unlicensed raffle or other event. A licensed charitable organization may accept the donation, but it must report the contribution as it would any other donation or contribution. The charitable organization should also be aware that accepting the donation may open it up to investigation and enforcement action by the division.
Are there any prohibited acts?
Pursuant to s. 202.16(1), Stats., no charitable organization, fundraising counsel, or professional fundraiser may, in the conduct of his, her, or its affairs, including the planning, management, or execution of a solicitation or charitable sales promotion, do any of the following:
- Use an unfair or deceptive act or practice.
- Imply that a contribution is for or on behalf of a charitable organization or use any emblem, device or printed matter belonging to or associated with a charitable organization without first being authorized in writing to do so by the charitable organization.
- Use a name, symbol or statement so closely related or similar to that used by another charitable organization that the use of the name, symbol or statement would tend to confuse or mislead a person being solicited.
- Represent or lead anyone in any manner to believe that the person on whose behalf a solicitation or charitable sales promotion is being conducted is a charitable organization or that the proceeds of the solicitation or charitable sales promotion will be used for charitable purposes if that is not the fact.
- Lead anyone in any manner to believe that another person sponsors, endorses, or approves a solicitation or a charitable sales promotion if the other person has not sponsored, endorsed or approved the solicitation or charitable sales promotion in writing.
- Use the fact of registration to lead any person to believe that the registration constitutes an endorsement or approval by the state.
- Represent or cause another to represent that contributions are tax-deductible unless they so qualify under the federal Internal Revenue Code.
- Represent or cause another to represent that the person has previously approved or agreed to make a contribution when in fact the person has not given this approval or agreement.
- Represent or cause another to represent that the person has previously contributed to the same organization or for the same purpose when in fact the person has not so contributed.
- Fail to apply contributions in a manner substantially consistent with the solicitation or the purposes expressed in the solicitation.
- Represent in any manner that registration constitutes an endorsement or approval by the department or the department of justice.
Is my charitable organization exempt from registration?
There are 12 reasons that qualify a charitable organization to be exempt from registration. If the organization does not meet one of the 12 reasons listed below, the organization will be required to register with the Wisconsin Department of Financial Institutions. To register, an organization must complete the Charitable Organization Registration Statement (Form #296).
- We are not a charitable organization, as defined in Wis. Stats. § 202.11.
We are a charitable organization, BUT WE DO NOT SOLICIT CONTRIBUTIONS.
NOTE: A private foundation, IF IT DOES NOT SOLICIT contributions, also falls under this exemption. See Wis. Stats. § 202.11, for the definition of "solicit" and "solicitation".
We are a religious entity that is exempt from filing a federal annual information return (Form #990) under sec. 6033(a)(3)(A)(i) and (iii)
and (C)(i) of the Internal Revenue Code.
NOTE: SUMMARY OF EXEMPTIONS FOR FILING RETURNSSection 6033(a)(3)(A)(i): Churches, their integrated auxiliaries, and conventions or associations of churches.Section 6033(a)(3)(A)(iii): The exclusively religious activities of any religious order.Section 6033(a)(3)(C)(i): A religious organization described in sec. 501(c)(3) of the Internal Revenue Code
- I am or we are a candidate for national, state or local office or a political party or other committee or group required to file financial information with the federal elections commission or a filing officer under Wis. Stats. § 11.02.
We are a charitable organization which does not intend to raise or receive contributions in excess of $25,000 during a fiscal year and all of our
functions, including solicitation, are performed by persons who are unpaid for their services and no part of our assets or income inures to
the benefit of, or is paid to, any officer or member of the charitable organization.
NOTE: If a charitable organization would otherwise be exempt under Wis. Stats. § 202.12(5)(a)3., but it raises or receives more than $25,000 in contributions or pays someone to do fundraising functions, it must, within 30 days register with the division.
We are a fraternal, civic, benevolent, patriotic or social organization that solicits contributions solely from our membership.
NOTE: An initial membership, when conferred solely as consideration for making a grant or pledge of money in response to a solicitation, is a contribution.
- We are a veterans organization incorporated under Wis. Stats. Ch. 188, or chartered under federal law or the service foundation of a veterans organization recognized in the bylaws of the veterans organization.
- We are a nonprofit, postsecondary educational institution accredited by a regional accrediting agency or association approved under 20 USC 1099b, or an educational institution and its authorized charitable foundations which solicit contributions only from its students and their families, alumni, faculty, trustees, corporations, foundations and patients.
- I am or we are a person soliciting contributions for the relief of a named individual and all contributions, without any deductions, were or will be given to the named individual.
We are a state agency, as defined in Wis. Stats. § 20.001(1), or a local government unit, as defined in Wis. Stats. § 605.01(1).
NOTE: Wis. Stats. § 20.001(1), reads: "'State agency' means any office, division or independent agency in the executive branch of Wisconsin State government, the legislature and the courts."NOTE: Wis. Stats. § 605.01(1), reads: "'Local governmental unit' means any local governmental association, authority, board, commission, division, independent agency, institution, office, society or other body, including any city, county, town or village board or common council, school or library board, or board of control of a cooperative educational service agency."
We are a private school, as defined in Wis. Stats. § 118.165.
NOTE: Wis. Stats. § 118.165, reads: "PRIVATE SCHOOLS. (1) An institution is a private school if its educational program meets all of the following criteria: (a) The primary purpose of the program is to provide private or religious based education. (b) The program is privately controlled. (c) The program provides at least 875 hours of instruction each school year. (d) The program provides a sequentially progressive curriculum of fundamental instruction in reading, language arts, mathematics, social studies, science and health. This subsection does not require the program to include in its curriculum any concept, topic or practice in conflict with the program's religious doctrines or to exclude from its curriculum any concept, topic or practice consistent with the program's religious doctrines. (e) The program is not operated or instituted for the purpose of avoiding or circumventing the compulsory school attendance requirement under sec. 118.15(1)(a). (f) The pupils in the institution's educational program, in the ordinary course of events, return annually to the homes of their parents or guardians for not less than 2 months of summer vacation, or the institution is licensed as a child welfare agency under sec. 48.60(1). (2) An institution may request the state superintendent to approve the institution's educational program as a private school. The state superintendent shall base his or her approval solely on the criteria under sub. (1)."
- We are a corporation established by an act of the United States Congress that is required by Federal law to submit to Congress annual reports, fully audited by the United States Department of Defense, of our activities including itemized accounts of all receipts and expenditures.
Does my organization need a special permit to conduct a raffle or to hold a bingo event?
Yes. Please contact the Division of Gaming of the Wisconsin Department of Administration for instructions on how to apply for a raffle or bingo license. The Division of Gaming’s website address is www.doa.state.wi.us/Divisions/Gaming.
I already paid a $10 registration fee to the Department of Financial Institutions, why am I being asked to pay an additional $54?
There are two separate renewal registrations that a charitable organization may need to file with the Department of Financial Institutions. If the organization is registered as a Wisconsin non-stock corporation, it will need to renew its non-stock corporation registration by paying a $10 renewal fee to the Corporation Section of the Division of Corporate & Consumer Services. You can find information about this type of registration on our website at www.wdfi.org/corporations. If the organization is registered as a charitable organization, it will also need to renew its charitable organization credential by paying a $54 renewal fee to the Charitable Organization area of the Division of Corporate and Consumer Services. You can find additional information about this type of registration on this FAQ page. (Please note, prior to 11/1/2013, charitable organizations would have paid their $54 renewal fee to the Department of Safety and Professional Services).
Are there any other Wisconsin state agencies or federal government agencies that my charitable organization may have to register with?
While not a complete list, other agencies you may want to contact include:
- Wisconsin Department of Financial Institutions – Corporate and Consumer Services Bureau: Registers corporations that are conducting business in Wisconsin, including non-stock corporations. www.wdfi.org/corporations
- Wisconsin Department of Revenue – Tax Operations Bureau: Issues Certificates of Exempt Status to non-profit organizations. www.revenue.wi.gov/Pages/FAQS/pcs-n-profit.aspx
- Wisconsin Department of Administration – Division of Gaming: Issues bingo and raffle licenses. www.doa.state.wi.us/Divisions/Gaming
- Wisconsin Department of Administration – Division of Administrative Services: Approves charitable organizations to participate in the State Employee Combined Campaign. giving.wi.gov/category.asp
- Wisconsin Department of Justice: Receives copies of the IRS form 990-PF from Private Foundations. This is an IRS requirement. See Federal Income Tax Regulation 1.6033-3 for more information.
- Internal Revenue Service (IRS) – Processes charitable organization applications for tax-exempt status under Section 501(c)(3) of the Internal Revenue Code. www.irs.gov/Charities-&-Non-Profits/Application-for-Recognition-of-Exemption
Must I notify the department before using a new trade name (doing business as name)?
Yes. A registrant must notify the department of the new trade name at least 30 days prior to using the name. Unless the registrant is informed by the department within 30 days of submission of the trade name to the department that it may not use the proposed trade name, the registrant may use the trade name.
Charitable Organization Annual Report FAQs
Why must I file an annual report?
The Charitable Organization Annual Report is designed to provide a complete and full financial reporting of the organization's charitable and non-charitable activities in sufficient detail to permit public evaluation of its operations.
When must I file my annual report?
All registered charitable organizations are required to submit either an annual report or an affidavit in lieu of annual report to the division within 12 months after their fiscal year-end. (See What form should I file my annual report on?)
What form should I file my annual report on?
There are three different reporting forms on which to file your annual report. You will need to select the form that best suits your organization's needs. The three forms are described below:
Form #1943 – Affidavit in Lieu of Annual Financial Report – This form can only be used if your organization received $25,000 or less in contributions during the fiscal year for which you are reporting or if your organization solicited only in the county in which it is located and received less than $50,000 in contributions during its most recently completed fiscal year.
Form #308 – Charitable Organization Annual Report – This form can be submitted without a copy of the Federal 990; although it should be noted that additional schedules are often required.
Form #1952 – Wisconsin Supplement to Financial Report – This form is the most commonly used form as it is most similar to the first page of the Federal 990 and shorter than Form #308. A Federal 990 must be submitted with this form.
Do I need to submit financial statements with my annual report?
Every registered charitable organization that received contributions in excess of $500,000 during its most recently completed fiscal year must file an audited financial statement, prepared in accordance with generally accepted accounting principles, and accompanied by the opinion of an independent certified public accountant relating to the financial statement.
Every registered charitable organization that received contributions in excess of $300,000 but not more than $500,000 during its most recently completed fiscal year must file financial statements, prepared in accordance with generally accepted accounting principles, which have been reviewed by an independent certified public accountant. Audited financial statements will be accepted in lieu of reviewed financial statements.
Can the audited financial statement requirement be waived?
A charitable organization may apply to the department for a waiver of the requirement for audited or reviewed financial statements. The waiver application shall be in writing, be received by the department within 90 days after the charitable organizations's fiscal year-end, and include documentation to support all of the following:
- The charitable organization's contributions were, during each of the past 3 fiscal years, less than $100,000.
- During the fiscal year for which the waiver is being requested, the charitable organization received one or more contributions from one contributor that exceeded $200,000, if the charitable organization is seeking a reviewed financial statement waiver, or that exceeded $400,000, if the charitable organization is seeking an audited financial statement waiver.
Is there a difference between an annual report and a registration renewal?
Yes. A charitable organization must submit an annual financial report to the division within 12 months after its fiscal year-end. A charitable organization is also required to renew its registration and pay its renewal fee on or before July 31st of each year.
Who should I contact with technical questions about the Charitable Organization Annual Report Form #308?
Form #308 was patterned after IRS Form #990. When in doubt about certain complex or technical issues, you may want to follow the more extensive guidelines provided by the IRS for completing Form #990.