How to Start a Non-profit: Step 1 – Filing Articles of Incorporation

1428631_83293066This fall, we’re creating blogs focused on various resources charities might need. This blog is part of a series focused on becoming a registered 501(c)(3) nonprofit organization from a Zealous Good team member who has done it before! Stay tuned throughout the next few months for direction on Registering for an EIN, Filing for Tax-Exempt Status, and little bits of advice!

Step #1: Filing Articles of Incorporation as a Nonprofit Organization

I highly recommend hiring a lawyer to navigate through all of the processes of becoming a nonprofit organization, but I understand how expensive they can get.  The idea behind this blog series is to gather all the information your lawyer will eventually need – hopefully cutting back on the hours spent (and charged) to your new nonprofit!

Please note: laws vary by state.  Check with your local government websites to verify fulfillment of requirements.

1)  Choose an Incorporator (or “Promoter” in some states)

  • Incorporators do the organizational/prep work. This includes bringing together the resources (people and moolah) to create the organization, and putting together and filing the Articles of Incorporation.
  • The Incorporator usually has lots of power until the Directors take over the corporation. Once the Directors take over, the Incorporator will have little power.
  • S/he must be over the age of 18
  • We highly recommend you hire a lawyer for this. Again, follow the rest of this blog series to prep what your lawyer will need!

2)  Choose a business name that meets state requirements.

  • You must make sure no one else has already claimed your name
  • Your name must end in one of the following: LLC, Corp, Co, Inc, or LTD (or one of those not abbreviated)
  • If your name implies any purpose other than what is listed as your purpose (below), you may be required to add “NFP” to the name

3) Appoint a registered agent

  • A registered agent is the person (or organization) that receives the legal and tax documents on behalf of your nonprofit.  Either a member of your organization or a third party (like a lawyer or service company) can act as a registered agent
  • Your registered agent must list a real (non P.O. Box) address

4) Appoint a Board of Directors:  In Illinois, you must have a board of directors consisting of between 3 and 7 members when becoming a nonprofit organization

5) Declare your purpose:  In the state of Illinois, your organization must fall under one of 34 categories listed here: http://www.ilga.gov/legislation/ilcs/fulltext.asp?DocName=080501050K103.05
If needed, you may choose more than one category

6) Paperwork:  If you’re in the state of Illinois, find your NFP 102.10: Articles of Incorporation here: http://www.cyberdriveillinois.com/publications/pdf_publications/nfp10210.pdf

7) Fees

  • In the state of Illinois: $50 filing fee
  • If you wish to have it expedited (reviewed within 24 hours), add on another $25. I don’t recommend this. The IRS will likely take a year to get back to you when you file your 501(c)(3) forms (seriously; this won’t happen in a week and likely not even a few months), so you don’t need to be in any hurry
  • $2.75 processing fee

8) Register for an EIN: Stay tuned for my blog entry in the upcoming weeks on the next step!

You’re now one step closer to becoming a nonprofit, and even better, one step closer to becoming an eligible Zealous Good nonprofit member!   Meanwhile, as you’re organizing things for your new office, don’t forget to donate those unneeded items to Zealous Good!

Michelle Retson is a Community Engagement Manager at Zealous Good, an in-kind donations marketplace in Chicago. Her family founded  the nonprofit, Healing, Health, & Hope. You can find Michelle on Google+, or Zealous Good on Facebook and on Twitter at @ZealousGood.

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