Anthony Mancuso - How to Form a Nonprofit Corporation (National Edition): A Step-by-Step Guide to Forming a 501(c)(3) Nonprofit in Any State

15th Edition

Attorney Anthony Mancuso

ISSN 2327-2287 (Print)

ISSN 2327-2279 (Online)

ISBN 978-1-4133-2864-6 (pbk)

ISBN 978-1-4133-2865-3 (ebook)

This book covers only United States law, unless it specifically states otherwise.

Copyright 19902021 by Anthony Mancuso. All rights reserved. The NOLO trademark is registered in the U.S. Patent and Trademark Office. Printed in the U.S.A.

No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise without prior written permission. Reproduction prohibitions do not apply to the forms contained in this product when reproduced for personal use. For information on bulk purchases or corporate premium sales, please contact .

Please note

We know that accurate, plain-English legal information can help you solve many of your own legal problems. But this text is not a substitute for personalized advice from a knowledgeable lawyer. If you want the help of a trained professionaland well always point out situations in which we think thats a good ideaconsult an attorney licensed to practice in your state.

The author extends a special thanks to his editor, Diana Fitzpatrick, and Stan Jacobsen for invaluable and thorough research assistance, and to all the hardworking people at Nolo.

Anthony Mancuso is a California attorney and a corporations and limited liability company expert. He graduated from Hastings College of the Law in San Francisco, is a member of the California State Bar, writes books and software in the fields of corporate and LLC law, and has studied advanced business taxation at Golden Gate University in San Francisco. He is currently employed by Google. He is the author of many Nolo books on forming and operating corporations (both profit and nonprofit) and limited liability companies. His titles include Incorporate Your Business, How to Form a Nonprofit Corporation (national and California editions), Form Your Own Limited Liability Company, The Corporate Records Handbook, LLC or Corporation?, and Your Limited Liability Company: An Operating Manual. His books and software have shown over 500,000 businesses and organizations how to form a corporation or an LLC. He also is a licensed helicopter pilot and a guitar player.

Introduction

Forming a nonprofit corporation may sound like a daunting task that you should hand over to a lawyer as quickly as you canafter all, arent there a lot of paperwork and filings, and complicated IRS nonprofit tax laws to learn? There is paperwork, and you will need to deal with the IRS, but the truth is, you can do it yourself. Forming a nonprofit corporation in any state is actually a fairly straightforward process. And, with the help of our line-by-line instructions, you can also obtain tax-exempt status from the IRS for your newly formed nonprofit corporation. Thousands of people have gone through the entire process of incorporating a nonprofit and obtaining 501(c)(3) tax-exempt status with this book to guide them.

Along the way, there may be decisions you need to make where you should seek professional advice. Well let you know when you need outside help. And even if you do decide to hire a lawyer to handle some of the work for you, the information in this book will help you be an informed clientand get the most for your money.

This book explains, in plain English, how to incorporate your nonprofit in any state and obtain 501(c)(3) tax-exempt status from the IRS. We show you how to:

prepare and file nonprofit corporation articles and bylaws in any of the 50 states

apply for and obtain 501(c)(3) tax-exempt status from the IRS

qualify as a 501(c)(3) public charity

satisfy IRS conflict-of-interest and excess-benefit guidelines

prepare minutes for your first board meeting, and

take care of postincorporation filings and tasks.

We provide advice and instructions for both the streamlined IRS Form 1023-EZ tax exemption application and the standard IRS Form 1023 application. In we explain how you can locate each states secretary of states office and state tax agency online to find state forms and additional information.

There are legal and tax technicalities that nonprofits must deal with in exchange for the substantial benefits they receive as nonprofits. We give you the information and tools you need both to form your tax-exempt nonprofit and understand the practical and ongoing issues related to running a nonprofit.

We know that any legal process can be challenging. We hope this book, with its step-by-step approach to incorporation and obtaining tax-exempt status from the IRS, will help you through the legal hoops and over the hurdles of incorporating your nonprofit in any state and obtaining tax-exempt status from the IRS. Congratulations on taking your first steps toward success in your new nonprofit endeavor!

Get Updates, Forms, and More at This Books Companion Page on Nolo.com

You can download any of the forms in this book at:

www.nolo.com/back-of-book/NNP.html

If there are important changes to the information in this book, well post updates there.

PART

How Nonprofit Corporations Work

Deciding to form a nonprofit corporation will be a big step for you and the members of your group. It will involve more paperwork and government forms, on both the state and federal level, than anyone will like; and youll have to conduct your business within the legal framework of various state and federal laws. Fortunately, there are big payoffs to all this work and attention, including the ability to attract donors and grant funds, obtain real and personal property tax exemptions and special nonprofit mailing rates, avoid corporate income taxes, and shield officers and directors from legal liability. Before starting down the path of nonprofit incorporation, however, youll want to learn a little more about who can form a nonprofit and the consequences of doing so. In this chapter, well explain:

the kinds of groups that canand cantform a nonprofit using this book

the benefits youll enjoy as a nonprofitand some of the disadvantages to choosing this route