NONPROFIT STARTUP

If you’re ready to start a nonprofit, make sure to answer these 7 questions first.

  1. Will you serve a “charitable class?”
  2. Do you have a charitable “program?”
  3. Can you feed and care for an organization?
  4. Can you fund the startup?
  5. Do you have an anticipated budget?
  6. Have you developed a funding plan?
  7. Do you have a board?

Did you answer “yes” to four or more of these questions?

We assist nonprofits across the country to incorporate, develop organizational documents, and file with the IRS (and, where applicable, the appropriate state agencies) for tax exemption and charitable status recognition.

Did you answer “no” to four or more?

We created an in-depth blog post to help you during the planning phase of your startup.

We knew our volunteers wouldn’t have the time or the expertise to handle all the legal requirements, or even know what they were. Charitable Allies took care of everything at a reasonable cost.

Jason Allmon, Former Head Pastor, Bainbridge Christian Church

WHAT TYPE OF NONPROFIT ARE YOU?

PUBLIC CHARITY

Refers to a majority of 501(c)3 organizations. For example: human society, social service, youth service, and more.

RELIGIOUS ORGANIZATIONS

To be deemed a “church” or “religious organization”, the IRS considers attributes such as having a recognized creed and form of worship, formal code of doctrine and discipline, distinct religious history, regular congregations, distinct legal existence, and many more.

PRIVATE FOUNDATIONS

Organizations that qualify for tax exemption in accordance with section 501(c)(3) is considered a private foundation. There are organizations that are specifically excluded from the definition according to section 509(a).

POLITICAL ORGANIZATIONS

Political parties; campaign committees for candidates for federal, state or local office as well as political action committees are all political organizations subject to tax under IRC section 527.

OTHER NONPROFITS

Other Nonprofits would include Social Welfare Organizations, Agriculture/Horticulture Organizations, Labor Organizations, and Business Leagues.

NONPROFIT DOCUMENT CHECKLIST

We want to help you get started on your mission as quickly as possible, yet with all the details covered to open a nonprofit. A typical nonprofit startup will involve 5 core documents/steps:

 

  • 1. Articles of Incorporation/Organization/Association

    • What entity structure will you use?
    • Does your foundation document have proper nonprofit “purpose” language?
    • Does the founding document have the IRS-required clauses?
      • Activities limited to one or more exempt purposes
      • Not empowered to engage in activities that are not charitable
      • Proper dissolution language
  • 2. Bylaws

    • Are the rules simple, and yet effective?
    • Will you and the rest of your organization (including the board) follow them?
    • Common considerations:
      • How many individuals will you have on your board?
      • Will there be an employee CEO or a volunteer staff?
      • Will you implement term limits?
      • Are there going to be nonprofit board committees?
  • 3. Obtain a federal Employer ID Number (EIN)

  • 4. Federal 501(c) Tax Exemption

    • Do you have a nonprofit business/programing plan?
    • Do you have a 4-year budget?
    • Are you an “EZ” charity (annual budget less than $50,000, among other requirements)?
    • Will you be sending funds internationally?
    • How to you intend to fundraise?
    • Will any of your directors be related?
  • 5. Other (Often Required) Nonprofit Corporate Documents

    • Conflict of Interest policy
    • Whistleblower policy
    • Internal Control policy
    • Funds Management policy
    • Restricted Funds policy

Need Help with your NPO Startup?

We have consulted with hundreds of nonprofit organizations and can start drafting template forms to assist with establishing your nonprofit.

ADDITIONAL NONPROFIT STARTUP HELP

Charitable Allies can also assist your nonprofit organization with the following resources:

    • Depending on the basis of your nonprofit, there may be entity-based protocol to be followed:
      • If a school: anti-discrimination policies, admissions policies, student and family manuals/handbooks, and much more
      • If a religious organization/church: statement of faith, religious employment criteria, marriage policy, facility use policy, formal membership policy to name a few
    • Securing state sales and property tax exemptions
    • Acquiring a reduced postage mailing permit
    • Helping implement nonprofit best practices
    • Creating an employee handbook and advising on employment law
    • Charting a five-year plan
    • And much more