Use the guide below to form a 501(c)(3) nonprofit in New York. Keep in mind that the process requires forming a nonprofit corporation and getting tax-exempt status with the IRS.
Since the overall process is extremely complex, we highly recommend consulting with an attorney or using a service like Harbor Compliance for personalized top-to-bottom nonprofit formation and obtaining IRS 501(c)(3) status.
Okay, so your first step is to secure a great “brand name” for your nonprofit that’s unlike any other entity registered with the state. It should also reflect your mission statement vs. giving the wrong idea or coming off as deceptive. Conduct a Business Entity Search through the Sec. of State to ensure there aren’t any naming conflicts.
There are a fair amount of other state-specific stipulations that you should take the time to understand. The issue is that if the name isn’t right and accepted, your Certificate of Organization (Step 5) will be rejected. Please bookmark Article 3 in the NY statutes to get complete information on naming. If needed, you can file an Application for Reservation of Name through mail with the Division of Corps that’s good for 60 days.
Filing Fee: $20
All incorporated nonprofits, along with business entities, must have a “statutory agent” or registered agent to officially receive critical paperwork on their behalf. This is so that you’ll always get them on time and there won’t be any hiccups with state filings or legal notices.
So you can hire a 3rd party professional and expect to pay up to $160/year, or get a NY Registered Agent free of charge when you incorporate through Harbor Compliance (see details). They handle this along with much more depending on your startup package.
An incorporator, and there can be more than one, is responsible for “executing” the Certificate of Organization with the state in Step 5. Pretty simple and the only real requirement is that they be over 18 year of age. Directors on the other hand bare far more responsibility. For now you’ll be recruiting at least 3 temporary directors to oversee the organization until in Step 7, you vote in/on the official directors of the board.
This is where the process can get complex, legal-heavy with corporate formalities, so it’s a good idea to work with either a nonprofit lawyer or an incorporation service who can help guide you and your team through this part of the process. If it’ll be helpful, here’s a link to the NY guidebook on Responsibilities of Directors of NonProfit Corporations that’s got plenty of details.
Bylaws are the rules/stipulations/regulations you write for how your nonprofit will be governed and managed along with the many other formalities that come along with having a board of directors vs a nonprofit that’s run expressly by members or volunteers. Common bylaws cover topics like:
If this is all new to you, use a savvy Corporate Bylaws Template which you can customize for your nonprofit and get an idea of the paperwork-side of bylaws.
Alright, if you’re ready to officially form your nonprofit corporation in the eyes of the law and public record, be sure everything is correct with your Certificate of Organization and have your incorporators sign/file it with the state. There’s minimal instructions on the document itself, so feel free to bookmark the New York Nonprofit Incorporation guide because it outlines more details.
You can also bookmark Articles 1 through 16 in the New York Code, or statutes to get the fine print so to speak. What’s important here is that you’re ready for this step. Don’t file before you’re sure all your ducks are in a row to save time and extra costs on refiling fees.
Filing Fee: $75
While there are a variety of modern ways to track and compile your nonprofit’s data (contracts, financials, important documents, etc.), what we’re talking about here is a physical records book where you keep copies of this paperwork should it become necessary. They’re very common. As common in the nonprofit/corporate world as brand logos. Are they required by the state? No, they’re not required.
You can pick one up at pretty much any office supply store or online through Amazon of course, but we’re huge fans of savvy-sleek Corporate Kits which include gorgeous records books, binders, blank certificates and more which you can brand for as little as $99.
Like the Articles of Incorporation, this part of nonprofit work can get very formal and complex for beginners trying to navigate the semi-corporate structure of conducting meetings, electing directors, discussing bylaws, and going through the motions so to speak. Your first meeting however should cover topics like:
Don’t forget to record “corporate minutes,” take roll call, record everyone’s name, and have it signed by all attending directors then add this to your new records book. If this is all new to you, use a savvy Corporate Bylaws Template from step 4 which you can customize for your nonprofit and get an idea of the paperwork-side of bylaws.
An EIN, or Employer Identification Number, is a 9-digit number required by all business and nonprofit entities under law in order to effectively track their financial activity. Think of it as a social security number for your nonprofit, but it will also make it possible to legally hire paid employees if needed and open up a bank account in Step 10.
Almost every transaction your nonprofit engages in will require an EIN. That said, you can get one quickly and free of charge by applying online through the IRS Website.
At this point your NY nonprofit corporation should be established, so now it’s time to handle any licensing/permit requirements and apply for tax exempt status. While we advise consulting a lawyer, here are some steps you can take to get the ball rolling:
A couple other resources we recommend you bookmark would be the NY office of the Small Business Administration and the state’s Biz-Dev Center because they have tons to offer nonprofits in terms of connecting with helpful services and other state-level organizations.
As a nonprofit you’re looking for financial utility and solutions that are geared for your needs – low fees, waved expenses, great online banking options, good interest rates (if your nonprofit maintains higher account balances) and other valuable services.
So, take some time to shop around at local, state and national banks/credit unions until you find the best option. Also, if you haven’t already, consider appointing a Chief Financial Officer (CFO) who’s knowledgeable and can help. If needed, check out this brief breakdown of Nonprofit Accounts to gain a better understanding and be sure to keep your nonprofit account 100% separate from all others.
If you’d like help forming a 501(c)(3) Nonprofit In New York, we highly recommend looking into Harbor Compliance for personalized top-to-bottom nonprofit formation and obtaining IRS 501(c)(3) status.