Step 1) Secure Your Nonprofit Name
Your first step is to secure a great brand name that’s unlike any other entity registered with the state. It should also reflect the mission of your nonprofit. Conduct a business entity search through the Sec. of State to ensure there aren’t any conflicts.
There’s a fair amount of other state-specific stipulations that you should take the time to familiarize yourself with. If your name isn’t accepted, your Certificate of Incorporation (Step 5) will be rejected. Bookmark Article 3 in the NY statutes for more information on naming your organization.
If needed, you can file an Application for Reservation of Name by mail with the Division of Corps.
Filing Fee: $20
Quick Note: Before you commit 100% to a name, you may also want to check that there’s a decent URL available for your nonprofit. Use WEEBLY to search your options. If there’s a quality domain name for purchase, we advise buying it right away. Even if launching a website isn’t on your radar right now, you might as well nail down a domain name that’ll make it easy for people to find you!
Step 2) Appoint A Registered Agent
Every incorporated business entity must have a statutory agent (or registered agent) to receive and process critical paperwork on their behalf. This ensures that there won’t be any hiccups with state filings or legal notices.
Some requirements for your registered agent:
- Must be a citizen of the state of New York
- Must have a street address in New York (not a P.O. Box)
- Must be available during normal business hours (9 am to 5 pm, Monday to Friday).
You can hire a third-party professional and expect to pay around $160/year, or you can get a full year of registered agent services free of charge by forming your nonprofit with IncFile.
Step 3) Select Incorporators & Directors
Now it’s time to select your nonprofit’s incorporators and directors. An incorporator is an individual responsible for “executing” the Certificate of Incorporation with the state (Step 5). Pretty simple -- the only real requirement is that they’re over 18 years of age.
Directors, on the other hand, have far more responsibility. For now, recruit at least 3 reliable individuals to act as temporary directors. They’ll oversee the organization until you vote in permanent board members (Step 7).
This is where the process can get complex and heavy with corporate formalities, so it’s a good idea to work with a nonprofit lawyer or incorporation service to help guide you and your team. (The NY guidebook on Responsibilities of Directors of NonProfit Corporations is also a great resource.)
Step 4) Draft Nonprofit Bylaws
Bylaws are the rules and regulations that determine how your nonprofit will be governed and managed. Common bylaws cover topics like:
- How meetings are to be conducted, and how often
- How new officers and directors are elected, and what responsibilities they have
- How voting takes place, how disputes are handled, and how records are kept
- Adding/amending bylaws (any changes must be reported to the IRS after incorporation)
If this is all new to you, consider using a corporate bylaws template to get an idea of what this document should include.
Step 5) File Certificate Of Incorporation
If you’re ready to officially form your nonprofit corporation in the eyes of the law, it’s time to file your Certificate of Incorporation with the state.
There are minimal instructions on the document itself, so head over to the New York Nonprofit Incorporation guide for more information. You can also bookmark Articles 1 through 16 in the New York Code for even more details. Regardless, make sure all the information you provide on your Certificate of Incorporation is 100% correct, and that your incorporators have signed it before sending it in.
The most important thing here is that you’re ready for this step. To save yourself time and money, don’t file until you’ve got all your ducks in a row!
Filing Fee: $75
Step 6) Start A Corporate Records Book
While there’s a variety of modern ways to track and compile your nonprofit’s important data, what we’re talking about here is a physical records book where you keep copies of all your essential documents. Is this required by the state?
No. But it’s a great way to stay organized, and even assert the legitimacy of your brand.
You can pick up a basic corporate records book at pretty much any office supply store or through Amazon, but we’re huge fans of corporate kits. These typically include gorgeous custom pieces like embossing seals and printed bylaws.
Step 7) Conduct Initial Meeting
Now’s the time to sit down with your initial directors and conduct an organizational meeting. This part of nonprofit work can get pretty complex, but regardless it’s important to address all of the following topics:
- Establishing process for approving and amending bylaws
- Appointment of officers, as well as committee management
- Setting an accounting/tax period and appointing a CFO
- Approval of initial transactions/setting up a corporate bank account
Don’t forget to take roll call and record your first meeting minutes, too!
Step 8) Get An EIN
An EIN, or Employer Identification Number, is a 9-digit number assigned by the IRS to track business entities’ financial activity. Think of it as a social security number for your nonprofit.
It will also make it possible to legally hire employees and open up a bank account. Point being, almost every transaction your nonprofit engages in will require an EIN. Get one quickly and totally free-of-charge by applying online through the IRS Website.