Once you have decided to incorporate your non-profit, your next task is to prepare to file with the state government to attain official non-profit corporation status.
The first stage of your preparations includes articulating your purpose as an organization and drafting a mission statement. You also need to recruit a board of directors. Whether you have your new board work together on articulating the purpose/mission statement or you recruit your board based on your pre-drafted purpose/mission statement will vary. You also need to select a name for your non-profit and register it with the state you are filing in.
Once you have those steps completed, the second stage of incorporation is submitting your completed Articles of Incorporation to your state’s Secretary of State. Most states host a website for their Secretary that include PDF forms, samples and instructions. You also must draft your organization’s corporate bylaws. While bylaws are not necessary, they are an important part of obtaining 501(c)(3) status with the IRS. All non-profits must also obtain a federal Employer Identification Number (EIN) to establish a business tax account with the IRS. For those non-profits who qualify for federal tax exemption as a 501(c)(3) organization, additional paperwork is necessary for representation by an agent under power of attorney or to elect to be permitted to make limited expenditures to influence legislation. In addition to the IRS paperwork, you must register within your state for permission to solicit funds for your organization.
After the initial paperwork has been submitted to both the state and the IRS, you must plan to make an annual filing with the IRS for your taxes and with the state for your financial reports. You must review your state’s ethics and accountability laws to ensure you are in compliance. California’s Nonprofit Integrity Act is available here. No other state legislature has yet passed similar legislation, but you can learn more about IRS Form 990 as well as look up your state’s specific codes on the National Council of Nonprofits Ethics and Accountability page.
You can also apply for a bulk mail permit at your local post office for a discount on your outgoing mail expenses. Please see the following blog posts for more details on the aforementioned steps.
