How do you create a Non-Profit Organization at the least costly?

How do I create an organization in the US for Indian-Americans to donate to charitable causes (education, medical treatment, financial support, etc.) in their communities back in India?

• We are a community of Catholic Christians from South India. There are a few thousand families who have now settled in the US and would like to help build their communities back home, particularly in the areas of education, medical treatment, sanitation, and generally empowering more of the less privileged to be financially independent. While I am aware of other charitable organizations, being a small community, it is important for us to retain a personal connection with the people we are helping. Is it possible to incorporate as a 501(c)(3) in the US where the donations go to a different country (India in this case)? What are the legal implications of this? Do we need to tie up with an existing charity organization in the foreign country, or can we function as a purely US organization with a branch overseas that handles the allocation and distribution of funds? What kind of paperwork would be required for the IRS both to attain and keep our status as a charitable organization?

• Answer:

  Yes you can create a US charity as long as it meets  http://www.irs.gov/Charities-&-Non-Profits/Charitable-Organizations/Exemption-Requirements-Section-501(c)(3)-Organizations. The charitable activities do not have to benefit just communities and individuals in the US, but can also be used to benefit international communities. I would start with http://www.irs.gov/Charities-&-Non-Profits/Charitable-Organizations and it is not an area I work in, but you may want to contact a CPA or attorney who is familiar with exempt organizations to assist you with the paperwork.