Charitable solicitation licenses (“CSLs”) are a necessity for any organization that solicits the public for contributions or donations to support a charitable purpose, unless specifically exempt by law. Many states have laws regulating the solicitation of funds for charitable purposes, including North Carolina (Chapter 131F), so it is essential to check the requirements for each state your organization operates in.
There are several exemptions in which an organization would not be required to file and renew a CSL in North Carolina; listed below:
- 131F-3(1): Religious institutions
- 131F-3(2): Federal, state, or local government, or their agencies
- 131F-3(3): Organization that receive less than $25,000 in contributions and does not provide compensation to an officer, trustee, organizer, incorporator, or solicitor.
- 131F-3(4): Educational institutions
- 131F-3(5): Hospitals
- 131F-3(6): Noncommercial radio or television station
- 131F-3(7): Qualified community trusts
- 131F-3(8): Bona fide volunteer, bona fide employee, or salaried officer of charitable organization
- 131F-3(9): Attorney, investment counselor, or banker who advises person to make contributions
- 131F-3(10): Volunteer fire department, REACT, rescue squad or emergency medical service
- 131F-3(11): Young Men’s or Young Women’s Christian Association
- 131F-3(12): Nonprofit continuing care facility
- 131F-3(13): Nonprofit fire or emergency medical service organization involved in the sale of goods or services that does not ask for a donation
Some exemptions are required to be updated annually, while others remain in place permanently, unless there are changes to the organization that affect the exemption. Review the North Carolina Secretary of State website to ensure your organization files the proper document, and/or submits a written request for your exemption (form 131F-3(3)).
If your organization does not qualify for an exemption, the CSL must be renewed each year that the organization solicits funds within the state. The CSL is due on the 15th of the fifth month after the organization’s year-end, the same as its Form 990 series. Each organization is granted an automatic two-month extension and can request an additional month extension by providing their federal tax return extension.
In North Carolina, your organization may owe a license fee (131F-8) with its application. The license fee ranges from $0-$200 and depends on the amount of contributions solicited per fiscal year. The CSL office also charges a late fee of $25 for each month past the due date of your CSL application.
North Carolina Secretary of State Links:
Please contact the Not-for-Profit Niche team at Gilliam Bell Moser LLP for further guidance.
