Upon forming a Non-Profit in New York, the first step to accomplish is to name your Non-Profit. There are specifics that must be observed when coming up with your New York Non-Profit name.
It should contain any of the following words: ‘Corporation’, ‘Incorporated’, or ‘Limited’. Its corresponding abbreviations may also be used in lieu of the words mentioned above. Further, there are restrictions as to the use of specific words and phrases in the Non-Profit name.
This can only be used with a written approval from the state. In addition, the name of your Non-Profit should not be similar or even closely resemble that of an existing business entity registered with the New York Secretary of State.
To determine the availability of the Non-Profit name you have selected, you can check it using the New York name search database tool.
When starting a New York Non-Profit, you must elect a number of officers and directors to serve the organization.
You need to nominate a minimum of three directors that must be 18 years old or above. These New York Non-Profit officers and directors shall serve the board until such time that a new set of directors are elected in the annual meeting.
Instead of the usual Registered Agent that you need to hire to receive process in behalf of your Non-Profit, the designated Registered Agent in New York is the Secretary of State.
Upon registering your Non-Profit, you must provide an address to the Secretary of State where the service of process and other legal notifications should be forwarded. If you want, you can also hire a New York Registered Agent, but it is not mandatory.
You can refer to Rocket Lawyer to provide you with a qualified Registered Agent if you want an additional agent.
To formally file your Non-Profit with the state, a Certificate of Incorporation must be submitted to the Secretary of State.
The Certificate of Incorporation should include a number of information, including: Non-Profit name, type, county where your Non-Profit is located, Non-Profit’s duration except if perpetual, a statement designating the Secretary of State as the Registered Agent including the address where the Registered Agent can forward your service of process, the name and address of an additional Registered Agent if any, name and addresses of the board of directors, and language provisions in relation to the policies for the Non-Profit’s internal affairs. The Secretary of State has an available Certificate of Incorporation form you can use to file for your Non-Profit.
In addition to the information mentioned above required when you file for a Certificate of Incorporation, you must also include a few languages needed by the Internal Revenue Service to grant you a 501(c)(3) tax exemption status. These languages should be in conformance to the stipulated requirements by the IRS to be approved:
The organizational meeting of the board of directors is a crucial meeting since there are several agenda that need to be decided and accomplished at this time:
The minutes of the meetings should be prepared as soon as the meeting ends.
A Corporate Records Binder should be maintained by your Non-Profit. This binder holds important paperwork like your New York Non-Profit registration papers, copies of business licenses and certifications, tax returns and reports, and other important pertinent Non-Profit paperwork.
Obtain a copy of a Corporate Records Binder at the local office supply shop or through Amazon.
As part of IRS requirements, you need to obtain a New York Non-Profit EIN even if you are not hiring employees.
An EIN is a nine-series number that distinctly identifies your Non-Profit, and is used for various transactions when you begin operations. This requirement can be easily obtained for free instantly by applying online at the IRS website.
By opening a bank account you will be able to keep your personal and business finances separate. This way, you can ensure that all your personal assets will not be mixed up with your business assets.
To find out which is the best bank for your New York Non-Profit, do the research. Visit this quick roundup for a list of our favorites.
There are several steps you must accomplish when looking into your New York Non-Profit tax registration exemption application.
And while you may be exempted from several taxes in the state, it is also important to look into the policies when it comes to registering for Non-Profit taxes through the New York Department of Taxation and Finance. To jumpstart the process of completing your tax exemption requirements, follow this three-step process.
The first step towards obtaining federal tax exemptions from the Internal Revenue Service is to file Form 1023, or the Application for Recognition of Exemption Under Section 501(c)(3) of the Internal Revenue Code.
A lengthy form and one that requires quite a lot of information, Form 1023 should be carefully filled out with every entry double checked for correctness. Also, it is advisable to go through a once over of the form for any additional instructions. Because the form is quite complicated, an alternative form is made available to smaller Non-Profits.
Any Non-Profit organization that has an annual estimated gross receipts lesser than $50,000 and total accumulated assets lesser than $250,000 can use Form 1023-EZ or the Streamlined Application for Recognition of Exemption Under Section 501(c)(3) of the Internal Revenue Code.
Compared to Form 1023, this form is much shorter and doesn’t require as much information. However, only smaller Non-Profits that have met the criteria mentioned above can use this alternative form.
As soon as the federal 501(c)(3) tax exemption is obtained, which exempts you from IRS taxes, your Non-Profit now qualifies for specific state tax exemptions. For further information on additional state tax exemptions, you can check the New York Department of Taxation and Finance.
In connection with the fundraising activities you want to schedule, you might be required to provide additional state reports and register for any of these activities. These all depend on the nature of your activity and the size of your Non-Profit, you can check the Attorney General’s office for information on these additional requirements.
After taking care of tax requirements, you should also adhere to the business licenses and regulations that you need to adhere to. Depending on your industry and area, the requirements will differ.
For more information, visit SBA.gov or look into this package where professionals find all the specific requirements on your behalf.
Now that you have followed the steps above, you are an official Non-Profit organization in the state of New York. Other than those 10 steps that are based on state guidelines, here are 2 additional steps based on best practices for starting a successful organization. Not required, but highly recommended.
The last final step to forming a New York Non-Profit is ensuring that your organization become successful in the duration of its entire operations.
While there is no surefire way to achieve this, using a business plan to lead you to a more direct path towards achieving goals and curbing possible challenges.
Through a business plan, your organization has a better chance at becoming successful in the short and long run. The links below should help you design an effective business plan.
Nowadays, it is important to build trust through a business website. However, since very few people starting a business in New York have technical experience, I recommend looking into WordPress.
WordPress is a free, easy to use, and customizable website builder. No design experience required. Learn how to build your website through this free guide.
Note that this guide is not meant as a legal document or advice. It was created for informational purposes only. Any questions with regard to starting a Non-Profit organization in New York or New York Non-Profit organizations in general should be referred to the expert advice of a business lawyer.