In Connecticut, charities are regulated by the Department of Consumer Protection (DCP). Any charity that solicits donations in Connecticut must register or file a claim for exemption from registration with the DCP.
Your organization may also need to apply for tax exempt status from the IRS and/or register with the Connecticut Secretary of State to do business in the state. However, you do not have to file with the IRS or the Secretary of State in order to apply to register with DCP for charitable solicitation. You may wish to consult an attorney or an accountant to determine what is best for your organization.
Before beginning to solicit donations in Connecticut, an organization must apply for registration, unless they meet the requirements for exemption. They can file a claim for exemption if they meet any of the categories below:
- Organized religious corporations, religious institutions, or religious societies;
- Parent-teacher associations or educational institutions accredited and recognized by a government body;
- Non-profit hospitals licensed under the laws of Connecticut or another state;
- Governmental units in the United States; or
- An organization that receives less than $50,000 in contributions annually, as long as the organization does not pay anyone to conduct solicitations.
If the claim for exemption is approved, the organization does not have to file again unless their status changes and they no longer qualify for exemption. Exempt organizations are listed along with registered organizations on the DCP’s website at www.elicense.ct.gov, as organizations legally able to solicit contributions.
If your organization cannot claim an exemption, you must:
- Complete the initial registration form;
- Provide a copy of your most recent IRS Form 990;
- Provide audited financial statements if your revenue on the Form 990 exceeds $500,000; and
- Pay a $50 registration fee.
However, you do not have to furnish financial documents if you have not completed your first fiscal year or filed your first IRS form 990.
Any changes to the organization’s name, address, officers, tax exempt status, legal form, or fiscal year end must be reported to DCP within 30 days.
Registered organizations that wish to continue soliciting donations must renew their registration each year. Renewal notices are send by email about 60 days before registration expires. One email message will contain the user ID and a second message will contain the password. Blank renewal forms are also available on the DCP website.
An organization should cross out any incorrect information on their renewal notice and write in the corrected information. To renew online, they must upload the corrected and signed renewal notice, the IRS Form 990, and their audit report, if an audit is required. They can pay the $50 registration fee with a credit or debit card.
If the organization’s registration is still due more than 65 days past the expiration date, they must apply for reinstatement by mail. They will have to mail in a reinstatement form, the required attachments, any required audit report, and the $50 registration fee, plus a late fee of $25 per month.
If the organization will no longer solicit donations in Connecticut, they may withdraw by sending in the Form 990 for the last year in which they solicited donations, their registration number, and either a letter stating the date of withdrawal or a copy of a dissolution document.
Paid solicitors and professional fundraisers must also register in Connecticut. These rules do not apply to any fundraiser who is either a permanent employee of the charity or a volunteer.
If a person or company plans, manages, or otherwise advises a charity regarding fundraising but does not solicit donations themselves or hire anyone to solicit donations, they must register as a fundraising counsel. A fundraising counsel must have a contract with the charity and must submit a copy of the contract to the DCP.
If the person or company is hired to directly solicit contributions, they must pay an annual fee of $500 and post a $20,000 surety bond with DCP. They must also file a notice-to-solicit at the start of each fundraising campaign and a financial report at its conclusion. These reports are filed jointly with the charitable organization.
Volunteer fundraisers must have an organization’s written permission to use their name and should verify that the organization is registered to solicit donations. If you wish to hold an auction or raffle to benefit a charity, you should check for local requirements or restrictions.