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MYTH: I didn’t apply to IRS for 501(c) (3) tax-exempt status, so I don’t have to file Federal annual nonprofit tax returns.

MYTH: For my new nonprofit, I will put all family members on the board of directors, and we will control the organization.

MYTH: Nonprofits are not allowed to make a profit from their activities.

MYTH: I am going to convert my for-profit business to a nonprofit business.

MYTH: If we’re running our nonprofit efficiently, our overhead and administrative costs should be small.

MYTH: I am starting a foundation to give out school supplies to kids who cannot afford them. I can’t wait to see their little faces when I give them new backpacks and markers!

MYTH: I am going to be president of my nonprofit and make $100,000 a year!

Much has been said about a shift in how we describe the communities we serve. Instead of writing a classic “problem statement” detailing what is wrong, or missing, we’re urged to write instead about what’s right--what strengths a community already has that it can build on. This “asset-based” approach doesn’t deny that work needs to be done, it simply affirms the resources and resilience that already exist.

MYTH: Nonprofit and tax-exempt mean the same thing. MYTH: I own my nonprofit.

Don’t forget to calculate the value of volunteers who make the program work—drivers to take people to and from their destinations, corporate employees who show up to work with students. It’s important to present a budget that accurately demonstrates what a program actually costs, even if some of those costs are covered by volunteer work or in-kind contributions.