Last Updated 06 September 2017 | By:

How To Form a 501(c)(3) Nonprofit In Pennsylvania

How to Use this Guide

Use the Attorney Approved guide below (reviewed by JGW INcounsel) to form a 501(c)(3) nonprofit in Pennsylvania. 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.

Step 1) Secure Nonprofit Name

Choose a Business Name

Okay, first you need to secure a good name for your nonprofit that’s unlike any other business name already registered with PA and that doesn’t contain restricted wording. To begin, conduct a Corporate Name Search through the state. For more specific information regarding names, bookmark Ch.17 of the Pennsylvania Code.

If needed, you can file a Name Reservation form with the Dept. of State Bureau of Corporations & Charitable Organizations that protects the name for 120 days while you’re forming, which gives you plenty of time.

Filing Fee: $70

Step 2) Appoint A Registered Agent

Choose a Registered Agent

Your registered agent is there so that your nonprofit always, and officially, receives important paperwork on time like state filings, legal notices, important tax forms, and so on. This is why they must be either a registered individual citizen or business entity in the state, have a physical street address, and be available during all regular business hours/days.

That said, you can hire an outside professional service and expect to pay up to $160/year, or get a registered agent free when you incorporate your nonprofit with a service like Harbor Compliance (see details).

Step 3) Select Incorporator(s) & Directors

Choose the Initial Directors

An incorporator (there can be more than one) is responsible for “executing” the Articles of Incorporation with the state in Step 5. Pretty simple and the only real requirement is that they be over 18 years of age. Directors on the other hand bear far more responsibility.

For now, you’ll be recruiting at least one temporary director to be named in the Articles of Incorporation or to be elected during the organizational meeting in Step 7.

For a bit more info on directors bookmark the Handbook for Charitable NonProfit Organizations through the PA Attorney General. Otherwise it’s a good idea to work with either a lawyer or a nonprofit formation service who can help guide you and your team through this part of the process and explain the finer details.

Step 4) Draft NonProfit Bylaws

Register an LLC

These are the rules you stipulate that determine how your nonprofit organization is governed and managed. All incorporated nonprofits need them because if they aren’t in place the default Pennsylvania statutes/codes take over which may not be the best option. According to the handbook linked above, in general nonprofit bylaws cover:

  • The scope of the authority that has been granted to board members and members of senior management;
  • The number of meetings that the organization must hold, the time period within which these meetings must occur (e.g., monthly, yearly, etc.), and the provisions for calling special meetings.

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.

Step 5) File Articles Of Incorporation

Business Licenses

Once you and your team decide it’s time to form the corporation, file your nonprofit Articles of Incorporation with the state by mail, fax, online, or in-person along with a Docketing Statement. Plenty of further instructions are on the forms, but be sure to include:

  • The name, duration of existence (if not perpetual) and statement of purpose,
  • Complete names and addresses of registered agent (and office), incorporator(s) and director(s),
  • Whether the corporation issues stock or has members and,
  • A stipulation of apportioning assets to any 501(c)(3) upon termination of your organization.

Filing Fee: $125

Publication of notice of filing the Articles of Incorporation in two newspapers is also required.  For details, see these Instructions for the Articles of Incorporation or the PA Code provisions on advertising.

Step 6) Start A Corporate Records Book

File Annual Reports & Publication Requirements

What we’re talking about here is a physical book, or some call it a binder, where you put copies of the most important documents that comprise your nonprofit organization: formation, registration, core licenses and permits, minutes of meetings, IRS tax-exemption confirmation, big contracts, annual reports and taxation/exemption documents, etc.

To get one for your nonprofit you can grab a quality records book at any nearby office supply store, order them online through Amazon, or get a professional Corporate Kit which lets you brand the book/slip case and more for as little as $99.

Step 7) Conduct Initial Meeting

Hold a Meeting with Your Board of Directors

For your first (organizational) meeting assemble the directors and get ready to establish the foundation of your nonprofit. Be sure to record “minutes” of the meeting and have it signed by a director for your records book. Topics you’ll cover will vary but should include:

  • Electing director(s), if directors are not named in the Articles of Incorporation,
  • Voting on the appointment of critical officers,
  • Voting on and approving/amending bylaws,
  • Establishing an accounting system,
  • Approving opening bank account(s), initial transactions, committees, and more.
  • Authorizing application to the IRS for 501(c)(3) tax-exempt status.

If you found the bylaws template useful, check out a similar Corporate Minutes Template you can customize and use to provide initial structure until you and your board get the hang of things should amending bylaws become necessary.

Step 8) Get An EIN

Get an EIN for Your LLC

An EIN is very straightforward. It’s a 9-digit identifying number like a social security number but for business entities including nonprofits that the IRS issues. You’ll use it to set up a bank account and hire paid employees if needed. Then the appropriate agencies will use it to track your financial activity.

The quickest and easiest way to get one is by submitting a request directly through the IRS Website.

Step 9) Handle Licensing & Exemptions

Small Business Taxes

At this point your nonprofit corporation should be established, so 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:

  • Download IRS FORM 1023 – Application for the Recognition of Exemption under Section 501(c)(3) of the Internal Revenue Code.
  • Or Form 1023-EZ – streamlined form but the nonprofit must be under $50k annual gross receipts and $250k in assets.
  • Bookmark the PA Dept. of Revenue and PANO in Harrisburg or see the Instructions for the Articles of Incorporation to get more specific information.
  • If you need help, check out Business License Research packages that can handle some of the legwork.

While we’re at it, a couple of other great sites to bookmark would be the Pittsburgh District Office of the Small Business Administration and Pennsylvania’s own SBDC page as well, because they’re likely going to have tons of valuable information and connections to nonprofit resources.

Step 10) Setup A Nonprofit Bank Account

Best Business Bank Account

As a nonprofit, you’ll likely conduct activities and charity events to generate money/donations for your cause or mission. In essence, your relationship with money is different and can be a bit complex, which is why a bank account is essential.

Most prominent institutions are used to working with charitable organizations so take your time to shop around (local, state, national banks and credit unions).

Don’t jump the gun here! This is critical. The differences per year from one bank to the next, relative to their other services, is important to research. If you’re interested, check out this Business Checking Accounts breakdown from some of the bigger mainstream banks for starters.

Need Help?

How To Form a 501(c)(3) NonprofitIf you’d like help forming a 501(c)(3) Nonprofit In Pennsylvania, we highly recommend looking into Harbor Compliance for personalized top-to-bottom nonprofit formation and obtaining IRS 501(c)(3) status.

They handle everything on your behalf and be on-call for questions you have. If you’d like more info, visit their website or read our review.