Seasons of Compliance -

The Importance of Calendaring in Navigating the Nonprofit Legal Landscape

February 26, 2024

As a nonprofit leader working to grow your organization, regulatory compliance is one of the main nutrients needed to establish a healthy growing medium, and a calendar is often your first (and free) compliance officer.

I know, I know, you just want to do the work, serve your communities, and all the paperwork is tedious, confusing, and boring! However, much like setting up automatic timers to water your garden most efficiently, spending some initial time and effort in early calendaring automation can save you a great deal of time and energy (and worse) for years to come.

What happens when you forget to water your garden during the summer months? Obviously, your plants get sad, wither, become more susceptible to pests and disease, and may die. Similarly, when you forget to file your annual reports with the relevant legal authorities, you are risking penalties, administrative dissolution, investigations, and revocation of your tax-exempt status. But simple automated calendaring can help avoid these blights!

Much like a well-tended garden requires seasonal attention to schedule planting, pruning, and harvesting, nonprofits must also have a structured timeline for regulatory obligations. Setting up repeating calendar reminders becomes the compass that helps nonprofits navigate the complex regulatory terrain. The legal landscape is dotted with various forms, filings, and deadlines, each requiring timely attention to avoid legal weeds that may threaten the organization’s growth. (Are you tired of garden metaphors yet? No? Good; let’s plow on.)

Step one: determine your state and federal regulatory overlords.

In Oregon, this will be the Secretary of State Nonprofit Corporations Division (SOS), the Department of Justice Charitable Activities Division (DOJ), and of course, the IRS (link is to the most common filing for new nonprofits, the 990-N).

Each state has its own rules on with whom, what, and when to file. If you are in California, you will (naturally) have more agencies to appease, including the Franchise Tax Board. California regulatory compliance is a subject for a later blog post.

Step two: determine your tax year and filing deadlines.

Your tax year will either be the calendar year, or another fiscal year (e.g. many nonprofits working in education have a fiscal year from July 1-June 30, to align with the school year and funding cycle). Your tax year will be on your application for an Employee Identification Number (EIN) with the IRS. It can be difficult to change later, so choose wisely!

In Oregon, as stated above you have three agencies to report to annually, which means three deadlines:

SOS. You have an “annual report” due each year on or before your organization’s “corporate birthday” – e.g. the filing date with the SOS, when you were first planted as a legal entity. When in doubt, you can always look up your organization on the Business Registry (this registry is a handy resource for when you might need a copy of your Articles of Incorporation and other important information). For example, if the SOS stamps your Articles of Incorporation as “Filed” on March 1, 2024, your “Annual Report” with them will be due on or before March 1 of each following year. And the annual report just takes a few minutes and $50 online, to make sure the organization’s information is up to date.
DOJ. Each year, on or before the “15th day of the 5th month after the end of your tax year” you will need to file a form CT-12 with the DOJ. And to save you from counting on your fingers, (or is that just me?) this will be May 15 of each year if your tax year is the same as the calendar year, and November 15 of each year if your fiscal year ends on June 30th. (For any other fiscal years, I have faith that you can figure this out!)
IRS. Luckily, the IRS and the DOJ have their annual filings due on the same day, that 15th day of the 5th month after the end of your tax year. For nonprofits with gross receipts during the year reported on (for example, during the entire 2023 calendar year if reporting on May 15, 2024) of $50,000 or less, you will be filing a simple 990-N online. For gross receipts of between $50,000 to $250,000, you will be filing a 990-EZ, and for gross receipts over $250,000 you will file a full 990 (likely with the help of a CPA).

Failure to meet these annual blooming deadlines could result in legal thorns, causing complications that may impede the nonprofit’s ability to fulfill its mission. These thorns include administrative dissolution by the SOS for missing filing the annual report, investigation by the DOJ, hefty penalties, and even “auto-revocation” of tax-exempt status by the IRS (for failure to file the relevant 990 for 3 years in a row). Reinstating carelessly lost tax-exempt status is possible (I have had to do this for clients many times, unfortunately) but it causes a great deal of easily-avoided stress, uncertainty, and delay.

Step three: Set up those repeat calendar reminders!

As I have heard podcaster Tim Ferriss say regarding the importance of redundancies, “two is one and one is none.” Thus, more than one responsible person and/or the organization’s shared calendar should have these 3 deadlines (with plenty of lead time) and all other important organizational matters (Board meetings, events, payroll, etc.) calendared, and those calendar events should be set up to repeat annually and indefinitely.

These calendar reminders act as a diligent sundial, ensuring that your nonprofit garden is thriving and free from regulatory weeds. By cultivating a well-maintained calendar, your nonprofit can navigate the legal landscape with confidence, ensuring that your mission blossoms and bears fruit in the fertile soil of compliance.