Starting a 501(c)(3) nonprofit in New York is easy, just follow these easy steps:
If you’ve been thinking about starting a 501(c)(3) nonprofit in New York, you have come to the right place. We have developed this comprehensive guide to help you not only start a nonprofit in New York but also make it successful.
Step 1: Name Your New York Nonprofit
The name you select for your nonprofit will establish its brand. It is the first thing most people will learn about your organization. It is important to pick a name that both aligns with your mission and follows the rules for naming in your state.
New York Nonprofit Naming Guidelines
The name of you pick for your organization must:
- Include an organizational designation, such as “Inc.”, “Ltd.”, “Incorporated”, or “Company”
- Be distinguishable from other business names in New York
- Not be deceptive or indicate the business if for any other purpose than what is stated in the Certificate of Incorporation
- Not include any words or phrases that may lead the general public to believe that your organization is acting as an agent of New York or the United States
- Not use any words or phrases that are considered obscene or ridiculing any person, group, belief, etc. or indicate that your group will engage in unlawful activity.
Your name cannot contain any of these phrases:
- doctor or lawyer (unless special permission is obtained)
- union, labor, council, industrial organization (when pertaining to worker’s rights, unless you attach an approval from the state board of standards and appeals)
- blind or handicapped (unless you attach an approval from the state department of social services)
- exchange (unless you attach approval from the attorney general)
- school, education, elementary, secondary, kindergarten, prekindergarten, preschool, nursery school, museum, history, historical, historical society, arboretum, library, college, university, or other restricted terms (unless you attach approval from the state commissioner of education)
You can read the New York State Senate's official guidelines for the complete rules on naming a New York-based organization.
To learn more, read our How to Name a Nonprofit in New York guide.
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Step 2: Appoint a New York Registered Agent
A nonprofit corporation in New York is required to have a registered agent with a New York address.
What is a Registered Agent? A registered agent is an individual or business entity responsible for receiving important legal documents on behalf of your business. Think of your registered agent as your business' point of contact with the state.
Incfile provides the first year of registered agent service free with nonprofit formation ($49 + State Fees)
To learn more, read our How To Pick a New York Registered Agent guide.
Step 3: Select Your Board Members and Officers
The directors of a nonprofit are responsible for overseeing the operations of the organization. The directors come together to form a board.
The officers of a nonprofit (such as the president or the secretary) are individuals with responsibilities, and the authority to execute based on their job descriptions.
Together, the officers and the board will come together to make up the organizational structure of your nonprofit.
The organization structure of your 501(c)(3) nonprofit in New York MUST include:
- At least 3 directors not related to each other
- A president
- At least one vice-president
- A secretary
- A treasurer
NOTE: The president and secretary positions cannot be held by the same person.
To learn more, read our guide on How to Select Board Members for Your New York Nonprofit
Step 4: New York Certificate of Incorporation
To become a nonprofit corporation in New York you must file Form DOS 1511 - Certificate of Incorporation.
In order to qualify for 501(c)(3) status, the organization’s purpose must explicitly be limited to one or more of the following:
- Testing for public safety
- Fostering national/international amateur sports competition
- Preventing cruelty to animals/children
The filing fee is $75.
- Checks and money orders for must be made payable to the "Department of State"
- Cash payments will only be accepted in person. Do not send cash through the mail.
- Accepted credit cards include Visa, MasterCard, and American Express
To learn more, read our New York Certificate of Incorporation guide.
Step 5: Draft Bylaws and Conflict of Interest Policy
There are two documents that will be central to the running of your nonprofit:
Bylaws: These are the rules that determine how your organization will be governed and run.
Conflict of Interest Policy: These are the rules set to ensure that decisions being made for the nonprofit are based on what is best for the organization, and not being motivated by what is best for individuals.
Step 6: Conduct an Organizational Meeting
An organizational meeting is the first official meeting of your nonprofit! Some of the things that are discussed in a typical organizational meeting:
- Taking attendance to show you have a quorum (minimum number needed)
- Appointing temporary officers, chairmen, secretaries, etc.
- Adoption of the bylaws
- Adoption of conflict of interest policy
Don’t forget to record “minutes” of the meeting and have it signed by all attending directors. Here are some corporate minutes templates to help you get the ball rolling.
Step 7: Get an EIN
An EIN or Employment Identification Number (also called a Federal Tax Identification Number or Federal Employment Identification Number), is used to uniquely identify a business entity. You can think of the EIN as a social security number for your nonprofit.
The EIN is required for your organization whether or not it will have any employees.
To learn more, read our guide on how to get your EIN.
Step 8: Register for State Tax Accounts
You will need to register for all applicable tax accounts with the State of New York and The City of New York (if you will be conducting business there).
Read the state’s tax guidance for new businesses and file for the appropriate state and/or city accounts.
For more information, you can call the Department of Taxation and Finance at (518) 485-6027
Step 9: Applying for Exemption from Federal (501(c)(3) status) and State Taxes
Applying for Exemption from Federal Taxes:
A nonprofit may be eligible for 501(c)(3) status only if its purpose is limited to one or more of the following:
Charitable, Religious, Scientific, Educational, Literary, Fostering national/international amateur sports competition, Preventing cruelty to animals/children, Testing for public safety
Before a nonprofit can apply for 501(c)(3) status it must:
- Elect at least 3 directors not related to each other
- Register as a nonprofit with the state
- Adopt the bylaws and conflict of interest policy
- Have an EIN number
Once these four conditions have been met your nonprofit can apply for 501(c)(3) tax-exempt status by filing Form-1023 online.
If your application is approved, the IRS will send you a determination letter stating that your organization is exempt from federal taxes under section 501(c)(3).
To learn more, read our guide on How to File Form 1023-EZ.
Applying for Exemption from State Taxes:
Once you have received your 501(c)(3) determination letter from the IRS, you can file for corporate franchise tax exemption using Form CT-247 - Application for Exemption. You can mail this form to the address below:
NYS Tax Department
W.A. Harriman Campus
Albany, NY 12227
For more information, you can call the Corporation Tax Unit at (518) 485-6027 or visit the Tax Department website.
To file to obtain sales tax exemption, fill out Form ST-119.2 - Application for Exempt Organization Certificate. You can mail this form to the address found below:
NYS Tax Department
Sales Tax Exempt Organizations Unit
W.A. Harriman Campus
Albany, NY 12227
For more information, you can call the Sales Tax Unit at (518) 485-2889 or visit the Tax Department website.
To obtain property tax exemption, research your options through the Office of Real Property Tax Service. You’ll also need to fill in one of several different forms depending on your property type.
Once you have formed your New York nonprofit, we recommend you read our guide on How To Protect your New York Nonprofit and Keep It Compliant.
Step 10: Open a Nonprofit Bank Account
After you acquire an EIN and a federal tax exemption for your nonprofit, you can open a 501(c)(3) bank account to begin soliciting donations or paying vendors and employees of the organization.
Opening a bank account for your nonprofit is the first step towards creating a paper trail of all income and expenses to show the IRS that your nonprofit is legitimate, honest, and legal.
There are several rules and exceptions that differentiate a 501(c)(3) bank account from a traditional business account. To find the best bank for your organization's financial needs read our review of the best banks for small business.
Step 11: Get Insurance for your Nonprofit
A nonprofit has assets and can be the subject of legal action or suffer financial damages from accidents, just like a regular business.
We recommend Commercial Insurance to protect your organization from lawsuits and damages.