New Statute and Rules on Charitable Solicitations Take Effect January 1, 2013

On January 1, 2013, we will update our electronic filing system to give an automatic three-month renewal extension to charitable organizations that have filed for an extension with the IRS. Charities will no longer have to file a separate extension with our office.  Although the software will enter an automatic three-month filing extension, charities must still file a renewal and financial report with our office by the 15th day of the fifth month after the organization’s fiscal year, unless the IRS authorizes a later date for filing Form 990. We may request documentation of the IRS authorization.

Changes to our electronic filing system reflect amendments to the Colorado Charitable Solicitations Act resulting from House Bill 12-1236 (PDF) as well as changes to Rules on Charitable Solicitations, both of which take effect on January 1, 2013.

Below is a summary of the amendments to the Colorado Charitable Solicitations Act:

  • Excludes grant writers from the definition of a “paid solicitor,” unless the grant writer’s compensation is calculated based on funds raised from the grant.

  • A fundraiser does not have to register with the Secretary of State if:
  1. The fundraising is on behalf of a specific individual, who is named in the solicitation, and
  2. The proceeds of the solicitation are given to or directly benefit that individual.
  • If a charity has filed for an extension with the Internal Revenue Service, the charity does not need to request a 3-month extension for its initial or annual financial report with the Secretary of State.

  • A charitable organization must deposit only monetary contributions with a financial institution.

  • In their opening greeting, a paid solicitor must state their full and complete name.

  • If a contribution is not tax-deductible, a paid solicitor must disclose that information near the beginning of a telephone solicitation, before soliciting a donation.

  • $41,440 is appropriated from the Department of State cash fund for implementation of the Act.

See the current Secretary of State rules, including the rules about the Colorado Charitable Solicitations Act.

 

Summary of the 2012 rulemaking changes to charitable solicitation rules: 

  • Clarifies and establishes definitions.

  • Requires an Employer Identification Number (EIN) for each user account.

  • Clarifies that user email addresses are not public records.

  • Provides a timeline for suspended and revoked organizations to submit hearing requests, and allows the Secretary of State more time to prepare for suspension hearings.

  • Gives the Secretary of State flexibility in how confirmations are delivered.

  • Clarifies the purpose and content of web-based registration certificates.

  • Clarifies that the Secretary may request a copy of the charity’s IRS Form 990. The Secretary of State can also request that the organization file an amended IRS Form 990, or otherwise correct any inconsistencies between the state registration statement and the IRS Form 990.

  • Implements changes made by section 2 of House Bill 12‑1236. Specifically, if a charity files for an extension with the IRS, the Secretary will automatically grant the charity a three-month extension for filing its initial or annual financial report. The amendments explain when an extension can be filed and when a solicitation notice can be amended.

  • Repeals the current Rule 6, which lays out the schedule for reminders and notices. The Secretary of State will continue to send reminders and notices to customers, but the schedule will be posted on the department’s website rather than in the rules.

  • Makes changes to late fee amounts and states when the Secretary of State will send uncollected late fees to State Collections.

  • Requires two years of returns for operational, unregistered charities that wish to register.

  • Provides more flexibility for the Secretary to approve waiver requests by making stipulations for administrator or website errors.

  • Clarifies the consequences of suspensions and revocations, as well as how suspensions and revocations will work.

  • Codifies internal administrative procedures about withdrawals.

  • Clarifies the reinstatement process and what information a charity must provide in order to be reinstated.

  • Clarifies that paid solicitor disclosure requirements also apply to subcontractors.

  • Some words and phrases in the rules have been changed for simplicity or clarification, but the meaning is not intended to be changed (except as described above). Cross-references in the rules are also corrected and updated. The rules were renumbered so that they are consistent with our rulemaking format and style.

 

See the Notice of Adoption (PDF), including the complete statement of basis and purpose and adopted rules.

See additional information about the October 25, 2012 rulemaking.

If you want to get notices or other alerts about rulemaking, send an email with the subject line: “Charitable Solicitations Rules Notification List” to SoS.Rulemaking@sos.state.co.us. Provide your contact information, including your name, title, organization, and email address. 

If you have questions about this policy or how it applies in your particular situation, contact our office at 303-894-2200, option 2, or charitable@sos.state.co.us.