Legal Question in Business Law in California

You can't do anything with the corporation until you have fully filed and obtained legal status. Call the people and try to track it down. Refile if necessary.

Well, if you do anything, it won't be as a California nonprofit corporation! That doesn't necessarily make it illegal, it's just not according to plan.

However, fundraising as a nonprofit when you aren't would be illegal.

Two areas worth discussing here. First, if you are having difficulty getting a corporation formed, consider having an attorney or a Sacramento-based paralegal service handle it for you. I often use a service called "Parasec" handle Secretary of State runs for me. For premium prices, the Sec. of State will handle incorporations on an expedited basis.

Next, don't confuse incorporation of a nonprofit at the California Secretary of State with 501(C)(3) status! Tax exemption allowing raising of money through exempt donations is done by the Internal Revenue Service, not the State of California, and it is a technical, lengthy process that involves a much more difficult application than preparation of Articles of Incorporation.

I have formed several non-profits and currently serve as CFO of another. Mr. Whipple is right. Do NOT confuse getting articles of incorporation filed with having 501c(3) status. 501c(3) status is a long haul and easy to screw up. You really should have a lawyer help you. The one bit of bright news is that you can raise funds prior to receiving yoru 501c(3) status as long as you make very clear in big bold letters that donations are not tax deductable. Once you get your IRS applications on file and accepted, you can then say the donations may be tax deductable pending IRS determination. If you get it before the end of the tax year you can then notify donors to go ahead and deduct. And of course once you get 501c(3) approval you can take fully deductable donations. One last bit of warning: not all private schools qualify for 501c(3) status even if they are not for profit. This is because they are not necessarily charities. If your students pay tuition and all of your income goes to salaries and operations, you probably will not qualify. That is why many schools have a separate charitable organization to raise funds and then donate them to the school.