What types of nonprofit entities can be formed to raise money for someone's benefit?

Question

Our family, along with some friends, have become acquainted with a family in our neighborhood whose young girl has a life-threatening illness. The required treatment is lengthy and expensive, so we collectively have been investigating ways to support them financially in their time of need. Notionally, we would like to set up some nonprofit entity that could raise funds (e.g. through soliciting donations or holding events) for her and her family's benefit.

I'm looking for some information as to what structural options are available in the United States in order to maximize the amount of financial support that can go to the family, while staying inside the bounds of any regulations related to income taxes or the family's current medical benefits. I realize that the work required to actually do so could be complicated and/or require professional help, but we're just exploring right now to find what options might exist.

Answer 1

Jason I think your doing a great thing.

Based on what your describing I would look further into a 501(c)(3). Chapter 3 from the IRS Publication 557 offers information. This Wikipedia gives a quick understanding of 501(c)(3) and how to apply.

Here is a great article from ehow it has some suggestions for someone who is just starting out. Maybe going through an organization already existing within your community might be a better, perhaps a church or some religious organization.