in the eyes of the law, a corporation is a legal entity; it is separate and distinct from the people who run it. Healthcare coalitions that go it alone become legal entities with all the rights and responsibilities that follow; those that use third-party fiduciary agents defer those rights and responsibilities to an external legally defined entity
Forgive us for being quiet lately, we've been bit busy. Within weeks we will take bParati.com 4.0 live, and it's more than just a pretty new face. Sure, it will be packed with much needed features, but the real power is under the hood. We invested much to the technology that will power the bParati healthcare coalition network, which will allow us to stream our content, fully formatted, to healthcare coalition websites in real time. When we publish a new resource, you get it on your coalition website– delivering excellent value to your members. Stay tuned.
Karl SchmittFounder & CEO
For healthcare coalitions, the choice is between establishing an independent nonprofit corporation or subletting the business and legal obligations to a third-party fiduciary agent. Like any choice, there are pros and cons...
healthcare coalitions that choose not to establish nonprofit corporations function much the same
Healthcare coalitions that choose not to establish independent nonprofit corporations, must use a third-party fiduciary agent to apply for grants and handle business services, such as banking, insurance, legal and accounting. Letting someone else handle the business end sounds good, right? Not always.
Learn more about the pros and cons of using a fiduciary agent
incorporating as a nonprofit provides benefits to the coalition that help pave the way to self sustainability, but yields new responsibilities
Like for-profit corporations, nonprofit corporations need banking, accounting and insurance services, and may need to engage legal services if the situation warrants. That said, incorporating provides important benefits for the healthcare coalition.
learn more about taking your healthcare coalition nonprofit
incorporating as a nonprofit does not require a healthcare coalition to apply for 501(c)(3) designation
Contrary to popular belief, taking a healthcare coalition nonprofit is not one and the same as taking it 501(c)(3). Becoming a nonprofit corporation is a state action that makes the coalition a legal entity, whereas obtaining a 501(c)(3) designation from the Internal Revenue Service (IRS), is a federal thing. The 501(c)(3) designation is optional and can be done at a later date.
Learn more about taking your healthcare coalition 501(c)(3)
becoming a nonprofit corporation does not mean a coalition is tax-exempt
Nonprofit status refers to status under state law.
The term nonprofit generally is used to describe an organization that works to serve a public purpose, rather than to provide financial benefit to any particular individual, corporation, or entity.
They are organized around a cause, mission, or community need – they are organizations that work to serve a public purpose.
They can be set up in several different legal formats, depending on the state.
Tax-exempt status refers to federal income tax exemption under the Internal Revenue Code.
Tax-exempt status exempts a nonprofit from paying corporate income tax on income generated from activities that are substantially related to the purposes for which the group was organized. People mistakenly call such organizations “501(c)’s” or “501(c)(3)’s," which refer to a specific tax category in the Internal Revenue Code.
A nonprofit organization is not automatically exempt from federal or state taxes. To become exempt, the corporation must meet certain requirements and apply with both the IRS and the State.
coalition governance changes little when transitioning to independent nonprofit status
Healthcare coalitions that establish independent nonprofit corporations must concern themselves with living by the requirements of their corporate charter. For coalitions using third-party fiduciary agents, governance starts with their bylaws.
Learn more about healthcare coalition governance
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