The following guidelines provide background information on the most common types of filings and the related exemptions in West Virginia.
This state has a narrow religious exemption for groups that are exempt from filing the IRS Form 990, such as churches. For these groups, the exemption is automatic. Depending on their activities in this state, other religious organizations, not exempt from the IRS Form 990 requirement, may need to complete a charitable registration, despite their religious identity.
This state defines solicitation broadly but has a registration exemption for organizations which: (1) do not use a professional solicitor, and (2) do not raise more than $50,000 in donations from the public annually. The statute does not specify whether the $50,000 maximum is for all donations or for West Virginia source donations only. Please note that the $50,000 maximum is effective on June 5, 2020 and is an increase from the previous maximum of $25,000.
In this state, organizations that are required to register have the option of registering through the Unified Registration Statement, which is a standardized charitable registration accepted in many states. As described in the introduction, using the URS, rather than a state-specific registration form, has pros and cons.
West Virginia does not have an online charitable registration option at this time, so the application must be submitted by mail regardless of whether the URS or the state specific registration is used.
Some states require organizations to appoint a “registered agent” in the state as part of the organization’s charitable registration. This state does not currently have this requirement.
This state requires organizations to include specific statements whenever the organization is requesting donations (also called “charitable solicitation”). Below is sample language to use with charitable solicitations in this state:
This request is on behalf of *ORG* in support of its mission to *PURPOSE*. This contribution is (OR IS NOT, as applicable) deductible for federal income tax purposes. A financial statement of the charitable organization disclosing the estimated percentage of the money collected which will be applied to the cost of solicitation and administration or how much of the money collected will be applied directly for the charitable purpose will be provided to any person upon request. Requests may be sent to *NAME* at *EMAIL*. West Virginia residents may obtain a summary of the registration and financial documents from the Secretary of State, State Capitol, Charleston, West Virginia 25305. Registration does not imply endorsement. [IF APPLICABLE, the number of the organization’s raffle, bingo or other such state permit is *NO.*]
Depending on the type and volume of activities an organization has in this state, the organization may also need to register as an out-of-state business (sometimes called a “foreign business”) with the secretary of state or another state agency.
These foreign business registration requirements are separate from the charitable registration. Not every out-of-state organization needs to register. An attorney can assist the organization in determining whether its connections with this state are significant enough to trigger the foreign business registration requirement.
Examples of activities that might trigger this requirement include having employees physically located in the state, conducting programs in the state, and having an office in the state.
In this state, 501(c)(3) organizations that have received recognition of federal income tax exemption are automatically exempt from the state corporate income tax. Organizations which are submitting a business registration will indicate their exempt status on the business registration form. Note that, although an organization may be exempt, if it has unrelated business taxable income (“UBTI”) that is subject to federal taxation, that UBTI also may be subject to state income tax. [See W. Va. Code § 11-24-5(a).] Consult with an accountant or attorney to confirm.
It is also important to consider whether applying for sales and use tax and property tax exemptions would be appropriate for your organization. More information about state sales and use tax and property tax exemptions are available at the West Virginia State Tax Department website. An accountant or attorney can provide answers to specific questions regarding your organization’s eligibility for exemption.
Sales and Use Tax Information and Exemption: https://tax.wv.gov/Business/SalesAndUseT-ax/Pages/SalesAndUseTax.aspx
West Virginia State Tax Department Publication on Sales and Use Tax for Nonprofits: https://tax.wv.gov/Do-cuments/TSD/tsd320.pdf
This resource contains general educational information related to legal concepts, but this information does not constitute legal advice. Anyone seeking legal advice is strongly encouraged to consult with a licensed attorney regarding any of the matters discussed herein. Although licensed attorneys work with Napa Legal, Napa Legal is not a law firm and does not undertake legal representation on behalf of any clients. Further, no licensed attorney working with or on behalf of Napa Legal agrees to undertake legal representation on behalf of any client unless the terms of such representation are set forth in a separate, written representation agreement.