Starting in October 2005, if a soliciting charity fails to make its annual filing with the Attorney General's Office, it is operating illegally.

    In recent years, the Attorney General's office has shown frustration with the lack of compliance by charities when it comes to the annual filings required for those soliciting donations within the state.  The annual filing requirement applies to charities not otherwise exempted that take in donations of $50,000 or more annually.  Those exempt are still required to file a certificate explaining why.

    In the summer of 2005, the State Legislature changed the solicitation laws by adopting Public Act No. 05-101.  Charitable solicitation registrations now expire annually.  Instead of just filing a report  -- primarily a copy of IRS Form 990 -- soliciting charities must actually re-register every year.  What's the difference?  The old annual report had a $25 late fee, period.  Failure to renew the registration now involves a $25 fine per month of delay, but perhaps more importantly, it means the organization is soliciting without being registered.  That can mean penalties not only for the organization but for anyone it hires or pays to solicit.  Soliciting while unregistered is punishable by up to $5,000 and one year in prison.  The Attorney General may also seek civil penalties up to $2,500, the appointment of a receiver, an accounting, or an order of restitution.  To be sure, these penalties are generally reserved for those cases where the failure to file is the tip of the iceberg, but the new law does indicate a willingness by the State to get tough on more innocent non-filers.

    An organization can apply for an exemption of up to 180 days under the new law. Call 860.808.5030 or e-mail Charity.Extensions@po-state.ct.us.  That's a big help, because organizations with revenues of $500,000 or more each year are required to file audited financial statements in addition to Form 990.  Late filers must face not only monthly penalties but the obligation to provide the required documents, financial statements and reports for each year it was unregistered.  Note: Charities registered before October 1 stay registered until the last day of the fifth month after close of that fiscal year.

    Organizations that conduct charitable solicitations in other states should remember that about 35 other states have their own laws governing solicitation in their territory.  In some states, organizations with websites that do "interactive" fundraising (when donors pay online)  or which receive significant donation from state residents may be considered to be soliciting within that state and may be subject to that state's laws.