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Setting up a nonprofit organization begins with determining whether you want to incorporate as a public benefit corporation or a private foundation. After deciding what type of entity you want to form, the next step is filing your incorporation articles. This is done online via the state of New York’s Division of Corporations. You must pay $100 to do this.
Once your articles of incorporation have been filed, you can apply for tax-exempt status. If you choose to become a public benefit corporation, you can deduct donations to your organization from your federal income taxes.
Next, you must register your nonprofit with the IRS. To do this, you must submit Form 990-NSC or 990-EZ. Once registered, you can begin receiving tax benefits such as tax exemption and low-interest loans.
Finally, you must complete your annual report. This document is required every year. It contains information about how much your organization received during the previous fiscal year, where it spent the funds, and how it distributed them.
Step 1: List out your nonprofit’s name.
In order to legally incorporate your 501(c)(3) nonprofit in New York, it needs a name. You’ll want to make sure that the name is distinct enough to avoid confusion among your members. Some organizations decide to keep their names under wraps until they’re ready to go public. Others are open about their mission from day one. Either way, there are some things you need to know before choosing a name for your organization.
The first thing to do is list your nonprofit’s name. This step is required by law. If your nonprofit doesn’t already have a name, you’ll need to register it with the state. There are three ways to do this:
1. Register your nonprofit’s name online.
2. Filing a paper application.
3. Applying by mail.
Your nonprofit’s name cannot include any words that might confuse its members. For example, “World Peace Organization” isn’t allowed because it could confuse people into thinking that the group is affiliated with the United Nations.
You’ll need to use a unique name for your nonprofit. Don’t use your name or the name of another organization. Also, don’t use a name that includes numbers or special symbols.
Step 2: Describing your nonprofit’s purpose
A nonprofit organization must clearly state what it does. This includes describing its purpose, mission, and vision. As part of this process, you’ll want to consider whether your nonprofit serves a specific population, such as children or seniors, and whether it focuses on a particular problem, like hunger or homelessness. You’ll also want to determine whether your nonprofit is focused on one geographic area or multiple areas. For example, if your nonprofit works primarily in New York City, you might choose to focus on the city’s homeless population. If your nonprofit helps people across the United States, you could focus on the issue of poverty.
The IRS requires nonprofits to file Form 990 every year. In addition to providing information about your nonprofit’s finances, Form 990 lists your organization’s name, address, mailing address, date established, number of employees, total income, revenue, expenses, assets, liabilities, net worth, and type of tax-exempt status.
Include the following information on your nonprofit’s Form
• Name of the nonprofit organization
• Address where mailings are sent
• Type of
Step entity (for example, 501(c)(3), 527, etc.)
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Step 3: Indicate If Your Nonprofit’s Purpose Needs Consent
The IRS Form, 990 Step instructions, state that nonprofits must include “a statement indicating whether the organization’s purpose requires consent or approval from another government agency Step or office.” This requirement is found under the section titled “Other Step Information Required,” which states, “If the organization’s purpose Step requires such consent or approval, indicate what agency or office provides such Step consent or approval.”
This requirement is part of Section 501(c)(3), and it is important to note that it does not apply to organizations that are
Step exempt under Sections 501(a) or 501(b). However, even though it does not apply to those exemptions, there is still a good reason why this information needs to be included on the form.
In addition to the fact that the IRS wants to know about this requirement, it is beneficial to have this information on file because it could help avoid future problems. For example, suppose the nonprofit is applying for tax-exempt status under Section 501(c)(4). In that case, it might want to check the box that indicates that the organization’s purpose needs consent or approval from another governmental agency or office. This way, the IRS knows that the application is complete and won’t have to go back and ask questions later.
Step 4: Select Your Nonprofit Corporation Type in NY
Nonprofits are organizations that exist to serve a public purpose. They operate under Section 501(c)(3) of the Internal Revenue Code. This section allows nonprofits to deduct certain expenses from income. In addition, it provides tax exemptions for donations to such organizations.
There are three types of nonprofits: corporations, partnerships, and LLCs. Each type has different requirements for filing a Form 990.
Large businesses most commonly use corporations. Corporations file Form 990-T. Individuals and small businesses typically use partnerships and LLCs. These entities file Form 990-EZ.
The IRS requires that each nonprofit corporation select one of four categories: religious, educational, scientific, or literary/artistic. You’ll need to choose one of those four options.
You’ll also need to provide information about your organization. For example, you’ll need to list your address, the names of directors and officers, and the amount of money raised during the previous fiscal year.
If you’re raising funds for a specific project, you’ll also need to indicate whether you’ve received matching grants from government sources. If you do receive matching grants, you’ll need to specify how much.
Finally, you’ll need to fill out Schedule B. On Schedule B, you’ll report your total assets, including cash, investments, real estate, vehicles, equipment, furniture, etc., along with their fair market value
Step 5: List Out Your Nonprofit’s County
The city where you live might determine whether your nonprofit qualifies for tax exempt status. If you want to know what your county requires, check out the IRS Publication 502. This publication contains information about how nonprofits are taxed, including requirements for filing Form 990-NPT.
Contact the IRS directly if you’re unsure whether your nonprofit is eligible for tax exemption. You’ll find the phone number on the form itself.
Step 6: Name Your Board of Directors
The final step in forming a nonprofit organization is naming the initial board of directors. This document records the organization’s creation and provides information about the board’s members. You’ll use it to provide information about each person’s role within the organization, including job title and responsibilities. In addition, you’ll include contact information for each director.
Include the names and addresses of the individuals serving as initial directors on your nonprofit’s formation documents. These people represent the individuals who will serve as the organization’s governing body. They will make decisions regarding the organization’s direction, such as setting policies and procedures, hiring employees, and determining budgets.
You’ll want to list the initial directors’ names when creating the organizational charter. If there are multiple individuals named, use titles of lineage if appropriate. For example, if one individual holds the position of president while another holds the position of vice president, you might name both individuals as presidents. However, if one individual holds no office, you don’t necessarily need to give him or her a title.
For a complete guide to developing boards of directors for nonprofits, check out our How to Form a Nonprofit Organization Guidearticle.
Step 7: Provide a physical address where service may be obtained.
A nonprofit corporation must provide its physical mailing address to the Secretary’s Office. If you are incorporated in another state, you must include the name and address of the agent authorized to accept process for service of process on behalf of the corporation. You must mail a copy of each notice, including notices of annual meetings, to the Secretary of State.
Your nonprofit corporation must keep track of all of its mailing addresses. These addresses are used for sending notices to members, donors, volunteers, employees, creditors, and others. They are also used to send tax forms and reports to the IRS.
Step 8: Add additional information to meet tax exempt requirements.
The IRS requires organizations seeking exemption under section 501(c)(3) to provide additional information about how the assets are being used. For example, suppose your organization plans to distribute assets to members or beneficiaries. In that case, the IRS wants to ensure those people do not receive more than what they paid into the organization.
This statement describes how the assets will be distributed upon dissolution. You can omit this step if your organization does not plan to dissolve. However, if your organization plans on dissolving, you must include this statement.
If your organization seeks tax-exempt recognition under section 501(a), you must include a statement explaining why your organization qualifies for such recognition. You must describe how your organization uses its funds, including where the money goes.
You must also include a statement describing how the assets will be used following dissolution. If your organization plans to dissolve, you must include a description of how the assets will be divided among the remaining members, directors, trustees, officers, employees, or agents.
Step 9: List Your Incorporator Information (NY)
An Incorporator is any person or entity that participates in forming an LLC or corporation. This includes individuals, partnerships, corporations, limited liability companies (LLCs), trusts, estates, government entities, churches, religious organizations, educational institutions, and nonprofit organizations. If you provide information about yourself, please list your name, telephone number, email address, and date of birth. You do not need to provide social security numbers, driver’s licenses, passports, or anything else like that. Just put down what you know.
When filling out the form, make sure to fill out each section completely. We cannot accept incomplete forms.
If you are filing as a foreign entity, you will need to complete the following sections:
1. Foreign Entity Registration Number
2. Name, Address, Telephone Number, Email Address & Date of Birth of Each Person Filing
3. Tax Identification Number
4. Type of Business Structure
Step 10: Fill out the contact sheet.
The Articles of Incorporation are the legal documents that officially establish a corporation. They set forth the name of the corporation, the purpose it serves, how many shares of stock are authorized, the number of shareholders, the amount of capitalization required, and other important information about the company. Once you’ve filed your Articles of Incorporation, you’ll want to make sure that you keep up to date on the status of your corporate filing. You can do this by completing the contact sheet in your filing certificate. This form is sent to the Secretary of State every three months during the term of your corporation’s existence. If there are changes to the Articles of Incorporation or the Certificate of Filing, those changes must be reflected on the contact sheet.
Incorporating a company can take anywhere from one day to several weeks, depending on the state where you’re incorporating. For example, Delaware requires no filing fee, while California charges $500. Some states require additional forms such as a statement of consent or a notice of intention to incorporate.
Step 11: File Formation Documents
Two ways to file for incorporation are by mail or telephone. Suppose you choose to do it by mail. In that case, you must file Form SS-4, Application for Employer Identification Number, Forms W-9, Request for Taxpayer Identification Number, and D-1, Application for Employer Registration, at least seven days before the date you plan to incorporate. You can find those forms here.
If you decide to go through the process by telephone, you must call 866-742-3279. After you submit your application, the IRS will send you a letter confirming receipt. Then you’ll receive another letter within 10 days of submitting your application saying whether or not your application was approved.
Fees depend on what type of entity you’re forming. For example, if you’re forming a domestic limited liability company, you pay $100; if you’re forming a foreign limited liability company, you’ll pay $125; if you’re forming an S corporation, you’ll pay $50; and if you’re forming a partnership, you’ll pay $150.
You also have several choices regarding where you file. You can file electronically via the Internet or use snail mail.
The easiest way to file electronically is to use the Electronic Federal Tax Return System (EFTPS). You can learn more about EFTPS here.
Frequently Asked Questions
How do I get a copy of the Articles of Incorporation in New York?
You may request a copy of the Articles by submitting a written request addressed to the above address. Your request must include your name, current mailing address, and the address where you want the certificate mailed to you. Please note that you are responsible for paying any applicable fees the Department charges.
What are articles of incorporation in NY?
Article of Incorporation (AOI) is a document filed at the New York State Department of State, Division of Corporations, where a company is incorporated. AOI is not a legal requirement for forming a corporation but is a prerequisite for filing Articles of Organization with the Secretary of State. To incorporate a business entity, an individual or group must file Articles of Incorporation with the Secretary of State of New York.
James Rourke is a business and legal writer. He has written extensively on subjects such as contract law, company law, and intellectual property. His work has been featured in publications such as The Times, The Guardian, and Forbes. When he’s not writing, James enjoys spending time with his family and playing golf.