Step 1) Secure Your NonProfit Name
Once you've chosen a name for your organization that conveys or is consistent with your mission, make sure it's unique, not too similar to another registered name in Washington, and doesn't contain any restricted/deceptive wording. Be sure to read the WA NonProfit Handbook to get the particulars (pg. 22)
Then, once you've chosen a name check for any naming conflicts by conducting a free Business Entity Search through the state. If needed, you can file a Name Reservation form with the Sec. of State to protect the name for up to 180 days so you have plenty of time to file Articles of Incorporation in Step 5.
Filing Fee: $20Quick Note: Before you commit 100% to a name, you may also want to check that there’s a decent URL available for your business. 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 business website isn’t on your radar right now, it’s going to be soon, and you might as well nail down a domain name that’ll make it easy for customers to find you!
Step 2) Appoint A Registered Agent
Your registered agent will be a legal representative of your nonprofit, but not in a lawyer or attorney-sense. It’s their job to officially receive/process critical documents like state filings, legal notices, tax forms, and so forth. This is why they have to be either a Washington resident individual/citizen or a legally registered business entity with a street address and be reliable during all regular business days/hours.
For most the two options they confront are either a) hiring an outside 3rd party which can cost upwards of $160/yr, or they get cheaper rates or deals through providers. For example, when you incorporate with IncFile they provide a registered agent for free for the first year.
Step 3) Select Initial Officers & Directors
Washington requires your nonprofit have at least 1 initial incorporator who among other things is responsible for filing the Articles of Incorporation with the state in Step 5. There can be more than one, yes, but these types of rules are subject to change over time. You'll also need to select at least 1 Director who will oversee the nonprofit until your initial meeting in Step 7.
Because this part can get complex thanks to the legal/tax nature of nonprofits, if possible it's a good idea to either hire the best nonprofit lawyer you can afford or partner with professional incorporation services who can provide expert assistance to see it's done right and you fully understand what's going on.
Step 4) Draft NonProfit Bylaws
Incorporated nonprofits need to have bylaws, or rules, that first and foremost determine how it's governed. They also state the mission of the nonprofit and steer it's course. They are essential. Other common bylaws touch on aspect like:
- How meetings are to be conducted.
- How new officers and directors are elected.
- How voting takes place, disputes handled, and records kept/managed.
- Adding/Amending bylaws (any changes must be reported to the IRS after incorporation).
- How to handle other nonprofit organization formalities in the state of Washington.
Step 5) File Articles Of Incorporation
Once you and your team decide it’s time to form and fully incorporate in the eyes of the law/public record, file your nonprofit Articles of Incorporation with the Sec. of State either through mail or online. Information you'll need includes:
- The name, type, duration of existence, and statement of purpose (provisions for nonprofit vs corp);
- Complete names & addresses of registered agent (and office), incorporators, and directors.
- Any specific provisions/bylaws set forth as part of the internal operations of your organization.
- A stipulation of apportioning assets to any 501(c)(3) upon termination of your organization.
Filing Fee: $30, or $50 for 2-day Online Processing
Step 6) Start A Corporate Records Book
If you're audited, a corporate or nonprofit records book/binder is what you'll need to show them. In fact, if there are any kind of disputes it is the records book which should contain documents covering the matter either through contracts, bylaws, minutes of meeting, tax forms, legal notices, and so on.
As the name of the book implies, it’s a record holder of your Washington registration, licenses and permits, and other critical paperwork. They're very common in conjunction with modern "cloud-based" storage. You can pick one up at nearby office supply stores, online through Amazon, or for $99 get a professional Corporate Kit which you can brand and customize.
Step 7) Conduct Initial Meeting
As this is your first official nonprofit meeting it's very important and organizational. Once you have a quorum (the needed amount of attendance in WA) be sure you record your first "meeting minutes" and put them in your records book. Topic covered should include:
- Voting on the appointment of critical officers;
- Voting on and approving/amending bylaws;
- Establishing a tax year as well as an accounting period;
- Approving initial transactions, committees, efforts, and more.
Step 8) Get An EIN
An EIN is an Employer Identification Number and your nonprofit organization will need one to be compliant on the federal as well as state levels whether you intend on hiring official employees or not. Why? Well, through this number relevant agencies track your financials through your bank account which you need an EIN to create.
Now, while there are a number of ways to get one, the quickest and easiest way is to apply/request one directly through the IRS Website.