HOW
TO
FORM
NON-PROFIT
ORGANIZATION
HOW TO START NONPROFIT/CHARITY?
HOW TO FORM NONPROFIT/CHARITY?
HOW TO LINKS
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SECTION 1
HOW TO
START
YOUR
OWN
NONPROFIT
OR
CHARITY
ORGANIZATION
Getting Started
The following information pertains mostly to
the U.S., with a side trip to Canada. I hope
this response fills the requester's needs --
and those of others who are Up to Do Good. At
the very least, I hope it provides a good start.
I was once involved in creating a political action
committee (PAC) in the U.S. The steps involved are
similar to those for charities.
Here are the very first:
1. Identify a need.
2. Create a method of filling that need.
3. Gather several like-minded people together
to build the organization and do the work
(this same group might also perform Steps 1
and 2, above). Make sure you're all on the
same page and committed to doing the work.
Once that's done, you'll need to appoint a treasurer
to handle the monies and -- vitally important if not
fun -- to file required tax forms.
In order to achieve and maintain tax-exempt status --
and you'll still be required to file tax forms even if
you don't need to pay taxes -- you'll need to incorporate
both federally and with your state or province.
In the U.S., an incorporated public charity is called a
501(c)(3). This curious name stands for the section of
Internal Revenue Service code covering public charities.
There are 28 types of 501(c) tax-exempt organizations.
The information in this Hub pertains only to 501(c)(3).
We found our own PAC-forming process to be a bit involved,
but definitely doable for common mortals.
How to Start Your Own Nonprofit or Charity Organization
http://hubpages.com/hub/How-Do-You-Start-Your-Own-Charity-Organization
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SECTION 2
HOW
DO
WE
FORM
A
NONPROFIT
ORGANIZATION?
Forming a Nonprofit Organization:
A Checklist
Every nonprofit organization must have a carefully
developed structure and operating procedures in
order to be effective at fulfilling its purpose.
Good governance starts with helping the organization
begin on a sound legal and financial footing in
compliance with the numerous federal, state, and
local requirements affecting nonprofits.
Determine the purpose of the organization. Every
organization should have a written statement that
expresses its reason for being.
Resources:
Board members,
potential clients,
constituents.
Form a board of directors.
The initial board will help translate the ideas behind
the organization into reality through planning and
fund-raising. As the organization matures, the nature
and composition of its board will also change.
File articles of incorporation. Not all nonprofits are
incorporated. For those that do wish to incorporate,
the requirements for forming and operating a nonprofit
corporation are governed by state law.
Resources:
Your secretary of state or state attorney
general's office.
Draft bylaws.
Bylaws — the operating rules for the board —
should be drafted and approved by the board
early in the organization's development.
Resources:
An attorney experienced in nonprofit law.
Develop a strategic plan.
The strategic planning process helps you express
a vision of the organization's potential. Outline
the steps necessary to work toward that potential,
and determine the staffing needed to implement the
plan. Establish program and operational priorities
for at least one year.
Resources:
Board members;
planning and management consultant.
Develop a budget and resource development plan.
Financial oversight and resource development
(e.g., fundraising, earned income, and membership)
are critical board responsibilities. The resources
needed to carry out the strategic plan must be
described in a budget and financial plan.
Resources:
financial consultant.
Establish a record keeping system for
the organization's official records.
Corporate documents, board meeting minutes, financial
reports, and other official records must be preserved
for the life of the organization.
Resources:
Your secretary of state or state attorney general's office.
Establish an accounting system.
Responsible stewardship of the organization's finances
requires the establishment of an accounting system that
meets both current and anticipated needs.
Resources:
Certified public accountant experienced in nonprofit
accounting.
File for an Internal Revenue Service
determination of federal tax exempt
status.
Nonprofit corporations with charitable, educational,
scientific, religious, or cultural purposes have
tax-exempt status under section 501(c)(3) – or
sometimes section 501(c)(4) – of the Internal Revenue
Code. To apply for recognition of tax-exempt status,
obtain form 1023 (application) and publication 557
(detailed instructions) from the local Internal
Revenue Service office office or from the IRS Web
site www.irs.gov. The application is an important
legal document, so it is advisable to seek the
assistance of an experienced attorney when
preparing it.
Resources:
Your local IRS office, an attorney.
File for state and local tax exemptions. In
accordance with state, county, and municipal
law, apply for exemption from income, sales,
and property taxes.
Resources:
State, county, or municipal department of revenue.
Meet the requirements of state,
county, and municipal charitable
solicitation laws.
Many states and local jurisdictions regulate
organizations that solicit funds within that
state, county, or city. Usually compliance
involves obtaining a permit or license and
then filing an annual report and financial
statement.
Resources:
state attorney general's office, state department
of commerce, state or local department of revenue,
or county or municipal clerk's office.
Other steps:
•Obtain an employer identification number(EIN)
from the IRS
•Register with the state unemployment insurance
bureau
•Apply for a nonprofit mailing permit from the
US Postal Service
•Obtain directors' and officers' liability
insurance
How do we form a nonprofit organization?
http://www.boardsource.org/Knowledge.asp?ID=3.367
How to Start
Nonprofit Organization:
Checklist, Tips & Resources
https://onlinemasters.ohio.edu/masters-public-administration/how-to-start-a-nonprofit-organization/
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SECTION 3
HOW
TO
LINKS
How do we form a nonprofit organization?
http://www.boardsource.org/Knowledge.asp?ID=3.367
idealist.org
http://www.nonprofits.org/
IRS
http://www.irs.gov
Nonprofit Directory of Resources
http://www.philanthropyjournal.org/resources/resource-directory
Nonprofit Resource Network
http://www.nonprofitresourcenetwork.org/
Resources | National Council of Nonprofits
http://www.councilofnonprofits.org/resources
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