authorized officer or registered agent of an organization registered to solicit
contributions in Colorado, you may recall that the organization is required to
update its registration statement and file a financial form with the Secretary
of State’s Charities Registration Program annually. This is in addition to the requirement to
file a periodic report with the Business Organizations Program.
of these filings is examined by program staff and may be rejected for certain
deficiencies. We appreciate that time
spent making these corrections is time that could be spent more productively pursuing
your organization’s charitable purposes, so we are providing information
about common mistakes that will help ensure you have your document approved the
first time it is filed. The chart below illustrates
the eight most common reasons for rejecting a filed document, followed by a
brief description of how to complete that section correctly.
Our filings require a street address for the
organization’s principal office, registered agent, and custodian of financial
records. In addition, please note that the
registered agent must be located in Colorado.
A P.O. Box or other mailing address may be entered in addition to a
street address, but it cannot substitute for one, not even in mountain and
rural communities. Please contact
program staff prior to filing a document, if providing a street address is not
possible or presents genuine concerns about personal safety.
Tax-Deductibility of Donations
The next most common reason for rejecting a
filing involves inconsistent answers about the tax-deductibility of
contributions to the organization. In
one question, the form simply asks if donations to the organization are
tax-deductible for the donor. This
question often trips up new or very small organizations, but generally
speaking, only organizations tax-exempt under section 501(c)(3) of the Internal
Revenue Code are eligible to receive tax-deductible donations.
It is possible, though not common, for an
organization to be exempt under 501(c)(3) without applying for a determination
letter from the IRS. It is also possible for a 501(c)(3) organization to apply
for a determination letter up to 27 months after the date of its formation and still
have donations to it be tax-deductible retroactively to the date of formation.
the form asks if the organization solicited any donations there were not
tax-deductible, and if so, whether the organization expressly provided a
statement to that effect to donors. You
just want these answers to be consistent.
For example, you should not indicate that donations are not
tax-deductible in one place and then state that the organization has never
solicited a donation that is not tax-deductible in another place.
Professional Fundraising Fees
There are two types of mistakes commonly made
in this section:
- An organization lists the name of a paid
solicitor or professional fundraising consultant on its registration in
Step 8, yet enters $0.00 in professional fundraiser fees paid in Step
9. If a name is listed in Step 8,
staff will expect to see some amount for professional fundraising fees in
Step 9(unless the only name listed is a commercial co-venturer). Note that any professional fundraiser’s
name listed in the previous reporting period will be carried over to the
current reporting period by default, so, if the organization did not
contract with that fundraiser or consultant in the current period and
indeed paid $0.00 in professional fundraising fees, you will need to
delete those names in Step 8.
- The organization lists some amount of
professional fundraising fees paid in Step 9, but it does not name a paid
solicitor or professional fundraising consultant in Step 8. If there is an amount listed for
professional fundraising fees, there should be at least one paid solicitor
or professional fundraising consultant named as well.
No Revenue or Expenses Listed
Another frequent reason for rejecting a
document is failure to list any revenue and expense items on the financial
statement. However, it would be unusual for this
to be an accurate depiction of the financial activity of the organization, if
the organization indeed had $0.00 in revenue and $0.00 in expenses, or
estimates it will have $0.00 in revenue and $0.00 in expenses, please send an
explanatory email to firstname.lastname@example.org prior to filing the
Balance Sheet Information
It is extremely rare for an organization to
have $0.00 in assets at the end of a reporting period. However, if this is the case, please send an
explanatory email to email@example.com prior to filing the
document. Note that staff routinely
compare balance sheet information from the previous reporting period to
revenues and expenses and balance sheet information in the current period, so
please confirm that the current period’s information is consistent with what
was reported in the previous period.
Missing Officers, Directors, Trustees, or Executive Personnel
The law requires that each and every individual be listed on the registration statement. This does not include strictly advisory boards, but it does include every person on the governing board of directors. "Executive Personnel" includes senior management like the executive director, development director, chief financial officer, chief operating officer, etc.
Reporting Year Incorrect
This involves organizations registering for the first time that have been subject to registration under the Colorado Charitable Solicitations Act (6-16-104 C.R.S.) in previous years. In such cases, the Secretary of State’s policy is to require the organization to file retroactively for at least two years, so the initial registration will need to cover the fiscal year prior to the most recently concluded fiscal year, and once that is approved, the organization will file a registration renewal for the next year. If financial information for the second year is not available, the organization files an extension request instead of a renewal by selecting "File a Document" and then "File an Extension."
Amendment Filed But Renewal Is Due
An "Amendment" is used to make additions or corrections to the most recently approved registration statement, but it does not advance the reporting period to the next fiscal year. To update the registration and provide financial information for the next fiscal year, you need to file a "Renewal," not an "Amendment." There is one wrinkle that involves organizations that filed estimated financial information with their initial registration. In that situation, the organization files an Amendment to replace the estimated financial information with actual financial information and checks the box to indicate the information is now actual, not estimated. In all subsequent years, it will need to file a Renewal.