Nonprofit organizations registered with the Office of Small Business and DVBE Services (OSDS) are eligible for benefits under the state's Prompt Payment Act. The Prompt Payment Program
is designed to expedite the invoice payment process for registered nonprofit organizations and certified small businesses. Additionally, a registered nonprofit organization receives higher interest penalties when the state exceeds its 45-day time limit (of the required payment date) to pay a properly submitted and undisputed invoice. Upon receiving written registration confirmation from the OSDS, the nonprofit organization may purchase a prompt payment rubber stamp to use on its invoices submitted to the state. The stamp alerts state agencies of a nonprofit organization's registered status and that he invoice should be handled promptly.
Nonprofit Organization Prompt Payment Exceptions
Nonprofit organization prompt payment benefits do not apply in the following cases:
- When a contract exceeds $500,000
Small Business Certification Eligibility
- When no Budget Act is enacted
Nonprofit organization are not
eligible for small business certification
because the applicant business must be a for-profit business and owned by one or more individuals and/or businesses.
Disabled Veteran Business Enterprises (DVBE) Certification Eligibility
Nonprofit organizations are not
eligible for DVBE certification
because the applicant business must be at least 51% owned by one or more disabled veterans.
Nonprofit Registration Requirements
Submit to the OSDS:
If your nonprofit organization was established less than one year ago and has not yet filed the Federal Tax Form 990 required above, submit:
- The entire, signed Federal Tax Form 990 (Return of Organization Exempt from Income Tax) for the most recently completed tax year.
- Your firm's "Articles of Incorporation" as filed with the California Secretary of State
, Section 927 et seq.
, Section 14835
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