Law Passed to Streamline State Reporting by Colorado Nonprofits

On April 26, 2012, Governor John Hickenlooper signed House Bill 12-1236 into law.  Effective January 2013, this new  law eliminates the need for a nonprofit who filed for the first extension on IRS Form 990 to also file for the first three month extension on reporting under the Colorado Charitable Solicitations Act (CCSA).  Many nonprofits currently have to apply for the first three month extensions on both their Form 990 and CCSA reports because financial information needed for their Form 990 is not ready.   

“HB 12-1236 is a win-win for nonprofits and the state of Colorado.  It will make it easier for nonprofits to meet their filing deadlines and will reduce the number of extension requests that the Secretary of State has to process,” said Mark Turner, Manager of Public Policy at Colorado Nonprofit Association. 

The law makes additional changes to clarify specific CCSA reporting exemptions and disclosure requirements as follows:

  • Exempts persons who exclusively raise funds to directly benefit a named individual, rather than providing a public benefit, from registration.
  • Clarifies that grant writers are not required to register separately as paid solicitors unless their compensation is based on a percentage of the funds they raise.
  • Requires that paid solicitors state their full name and if contributions are not tax deductible prior to securing a donation over the telephone.
  • Clarifies that only contributions of money must be deposited in a charity’s bank account within two business days by a paid solicitor.

The bill was sponsored by Rep. Ken Summers (R- Lakewood), Rep. Chris Holbert (R- Parker), Rep. Rhonda Fields (D- Aurora), Rep. Andy Kerr (D- Lakewood), Rep. Jeanne Labuda (D- Denver), Rep. Dave Young (D- Greeley), as well as Sen. Cheri Jahn (D- Wheat Ridge), Sen. Betty Boyd (D- Lakewood), and Sen. Linda Newell (D- Littleton).

Contact Mark at (303) 832-5710 or mturner@coloradononprofits.org for more information on how this change will affect your nonprofit organization.