How to Register a Nonprofit
Registering a nonprofit is a complicated process. If you want to avoid making costly mistakes, it's important to understand how the process works and what steps are involved. This article will explain the basic steps of registering a nonprofit and guide you through each one.
Determine your Mission
Before you start, it's always a good idea to know exactly why you are starting the nonprofit. What's your mission? Why do you want to do this? What is your purpose?
The second question that needs answering before you register as a nonprofit organization is "who will benefit from my work?" Are there specific people or groups of people in need of assistance that your organization will be able to assist? The best nonprofits help fill an unmet need in the community or region where they operate and help those who have been left out.
It's also important to think about how success will be measured for your project. If possible, consider creating goals for yourself and then measuring progress towards those goals over time. If this isn't feasible due to limited resources or other factors outside of your control (e.g., government funding), then consider setting up milestones along the way and celebrating significant achievements each time one is reached.
Explore Legal Structure
Once you have a strong idea of what your nonprofit will do and how it will operate, you'll need to choose the most effective legal structure for your organization. The four main types of nonprofits are corporations, trusts, unincorporated associations and sole proprietorships.
The first two structures—corporation and trust—are considered the most formal types of nonprofit organizations. They each require more paperwork and registration fees than other structures but can offer tax advantages not provided by less formal options such as sole proprietorships or unincorporated associations.
You'll want to work with an experienced attorney when considering these options so he or she can help determine which structure is best suited for your needs as well as provide assistance on all necessary filings and paperwork.
Choose a Name
The next step is to choose a name for your organization. If you're thinking about registering with the state and federal governments, it's important to choose a name that doesn't have any legal restrictions. This means that the name should be unique and not too similar to another organization's registered trademark or service mark. It also shouldn't imply that your nonprofit is engaged in any particular activity (like fundraising). The best way to check whether a name is available for use with your state government is through the Secretary of State's office.
File Articles of Incorporation
Once you have your Articles of Incorporation, you can file them with the state. In some states, it's a simple online form; in others, it involves mailing or faxing them to the secretary of state. The process may vary by state and agency, so be sure to check with your local agency before filing.
Another thing to keep in mind is that your Articles of Incorporation should be signed by an incorporator—usually you or another person who has been designated by the board as acting on behalf of the organization—and notarized.
Submit your Registration
Now that you have your articles of incorporation and have paid the filing fee, you'll be ready to submit your registration. This process begins at the state level, where you will submit your articles of incorporation along with a fee to start the Nonprofit Corporation Bureau (NCB) process. Once this step is completed, NCB will issue an approval letter along with instructions on how to continue submitting forms and fees necessary for registration.
Once all fees have been paid and all necessary paperwork is complete, NCB will send an email notifying you that they can proceed with finalizing your registration as a nonprofit organization. The final steps involve paying one last fee ($200) and completing some additional forms after receiving this notification from NCB; then wait up to 30 days for release of tax-exempt status by Internal Revenue Service (IRS).
Obtain the Required Forms
- Obtain the required forms. You need to apply for a federal tax exempt status known as 501(c)(3) with the IRS (Internal Revenue Service). To do this, you'll need to fill out a form called the 1023 Application for Recognition of Exemption Under Section 501(c)(3) of the Internal Revenue Code and submit it electronically through the IRS website.
- Request an application from your state's office of charitable trusts or charities division.
- Complete your application and submit it along with any necessary fees (typically $500-$750) to your state’s office of charitable trusts or charities division
When you are trying to register a nonprofit organization, it is important to secure funding from foundations and grants. You can also apply for loans and federal funding. State and local governments might be able to provide some support as well. You can also apply for corporate sponsorship or donations from individuals or companies.
It is important to understand that the process of registering a nonprofit organization can take several months. In some cases, you may need to wait up to a year before your application is approved. After you have been approved by the state, you will have access to federal tax rules and regulations.
In summary, registering a nonprofit organization is a complex process that requires careful planning. However, it's also an exciting time for your new organization as you get ready to serve the public and make a difference in the world.