5 requirements you must meet to start a non-profit corporation
There are many reasons you might want to start a non-profit corporation. Perhaps you have a passion for giving back and a great idea for addressing a known need or issue in the world. Maybe you already operate a for-profit business and would like a separate charitable organization for tax purposes.
Regardless of why you want to start a 501(C)3 organization, you will need to meet certain requirements in order to succeed in your endeavor. What will you need to start a non-profit corporation?
An organizational name
You will need to register your corporate entity’s new name, ideally early in the process. Having a unique name that conveys your organization’s intent and inspires trust can help you build a brand that will compel people to donate or volunteer.
A board of directors
Just like any complex corporate structure, a non-profit corporation requires a board of directors that oversees its operations. Choosing multiple people with different professional and personal backgrounds can help set your non-profit organization up for success. Your board of directors will not only determine the way your company operates but will also influence how much trust possible donors have in your organization.
Articles of incorporation
Having a formal written document discussing how your organization will operate and the intention behind creating the organization is important. Those documents will guide the board of directors and executives when they must make important decisions about the future of the non-profit organization or what to do with resources or funds.
An Employer Identification Number
Even if you only intend to have one employee or aspire to command a workforce of primarily volunteers, you will likely need to register with the Internal Revenue Service (IRS) for an Employer Identification Number (EIN). If you do intend to hire employees or bring on volunteers, you may need to look into insurance coverage options to protect your non-profit organization and the people who support it.
In order to actually be a non-profit organization, the IRS has to recognize your corporation as a non-profit entity. If you successfully file for this status, you will not have to worry about paying federal income taxes on revenue generated by the organization.
Learning about what you need when starting a non-profit corporation will lead to a faster and more successful startup process.