Liquidating assets for charity
Typically, after several years, the statute of limitations kicks in and any further claims will be time-barred. Once creditors and dissolution expenses have been paid, any remaining assets and funds must be transferred to another nonprofit (or a governmental entity if the governing documents permit) pursuant to the corporation’s dissolution provision as discussed above.
The transfer should be made pursuant to a grant agreement to document the transfer and the purpose of the grant.
You can’t use the online closure form to tell the commission about the dissolution of your CIO. You need to put ‘CIO dissolution’ in the subject and confirm: You also need to give details of how any property vested in, or held in trust for, the CIO has been or is to be applied in accordance with the directions in its constitution.
Nonprofit corporations are often faced with tough decisions about their future.
Consider if you can make effective use of the charity’s remaining funds by transferring them to another charity with compatible purposes.
Alternatively, you might find a community foundation or some other charity may offer to continue to run your trust in line with its objects.
For a variety of reasons, a nonprofit’s board may determine that dissolution is the best answer.
Unlike other forms of charity, a CIO automatically ceases to exist when it’s removed from the register.In Arizona, the legal steps to dissolve the Corporation are as follows: Business Steps.