If the Project Leader and your project advisory board determine that your project should exist as a free-standing nonprofit tax-exempt corporation, or affiliate with another existing tax-exempt charitable organization, you should bring this to the attention of your program liaison. If you are considering setting up a new 501(c)(3) nonprofit organization, Community Partners will discuss with you the issues involved in incorporating and securing tax-exemption. Community Partners will also provide a project separation checklist of services and systems you will need to set up for your independent organization, and will assist you in developing a separation timeline.
Upon separation, the new tax-exempt organization operating your project may receive – after provision for any unpaid debts – the remaining unspent funds in your project account, as well as other assets owned by Community Partners for the benefit of your project. Community Partners will also work with funders to transfer grants and contracts to the successor organization.
Community Partners will prepare a Project Separation Agreement to be signed by you and an authorized signer of the successor organization. Assets and liabilities will be transferred when the successor organization has provided its tax-exempt designation from the IRS and the separation paperwork is complete. Cash transfers, if applicable, will occur within six weeks from when the Project Separation Agreement is executed and all project contracts and grant obligations have been finalized. All employees of your project will be terminated by Community Partners and their re-employment will be at the discretion of the successor organization. When (and only when) the separation is complete, the successor organization may then carry on the mission of your project or fundraise in its name.
Please note: The administrative charge applied to project revenues by Community Partners is assessed immediately upon their receipt and is not refundable upon termination of the relationship.