Research Results:
Paper Abstracts

Extent and Nature of Overlap Between Listings of
IRS Tax-Exempt Registrations and Nonprofit Incorporation:
The Case of Indiana

Kirsten A. Grønbjerg and Laurie Paarlberg

Nonprofit and Voluntary Sector Quarterly 31 (December, No. 4): 565-94. Copyright © 2002 by Sage Publications, Inc. Abstract reprinted by Permission of Sage Publications, Inc. Revised version of paper presented at the Annual Meetings of ARNOVA, Miami, FL., November 29-December 1 2001.

Abstract

To consider the capacity of nonprofits and communities to respond to public policy initiatives we use a comprehensive database of Indiana nonprofits to examine two indicators of nonprofit formalization: tax-exempt registration under Section 501(c) of the IRS code and/or formal incorporation with the Indiana Secretary of State. We find that only 23 percent of the 54,108 nonprofits in our statewide database meet both criteria for formalization. We test whether more formalized nonprofits (appearing on both lists) are larger, older, and active in more institutionalized fields than those on only one or neither of the two lists. Our findings generally confirm these expectations. We also hypothesize that larger, growing, and more institutionally developed communities will have a more formalized nonprofit sector (greater list overlap). However, few community-level variables relate meaningfully to our measure of sector formalization. We speculate on other factors that may be relevant for such an analysis.