Legal Question in Business Law in Washington

Re: How to convert an S-corp to a non-profit

Non-profits are heavily litigated, also by the IRS and so you want to get your investments out before you convert, which is involved and not cheap. We can do this for you when you're ready and advise you on how to handle this entire process.

Re: How to convert an S-corp to a non-profit

Under Washington State Law a corporation may be voluntarily dissolved by its board of directors. There may be tax implications, so each shareholder as well as the corporation should work closely with their respective accountants and with legal counsel.

An essential and important distinction between non-profit and for profit corporations is that the non-profit does not benefit the board of directors or the executive. Thus there is no place for disbursements or loans. To do otherwise would jeopardize the tax-exempt status of the non-profit.

The difference is fundamental and you should seek competent legal and accounting help immediately by from a WSBA licensed attorney and a Washington CPA.