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It is this separate legal existence that provides protection from liability.
Being a corporation opens the door for employee benefits such as group life insurance, health insurance, or a pension plan, advantages not always available to workers in unincorporated organizations.
It's essential for a nonprofit, whose board members may hold opposing ideas, to have clear-cut rules about delegation of authority and how to get things done.
Having all of these principles in the articles of incorporation and bylaws makes running the organization much easier.
Other advantages of incorporation include exemptions from county real and personal property taxes, lower postal rates on third-class bulk mailing, cheaper advertising rates, free radio, and television public service announcements (PSAs), and more—depending on your activities.
Certainly, if you anticipate that your nonprofit will grow, it would be wise to incorporate and apply for tax exemption earlier rather than later.
Don’t get me wrong – it’d be a nice problem to have.
Creditors can only go after your organization's corporate assets, not the personal assets of the people who manage, work for, or volunteer for your nonprofit.
Personal liability can also occur should a staff member or volunteer strays outside the boundaries of what is permissible politically.
Nonprofits can only participate in limited political activities.
If someone becomes overzealous and oversteps the boundaries, the organization could be sued. A corporation is separate from the individuals who manage or organize it.