Okay, so your first step is to secure a great “brand name” for your non-profit 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 Articles of Incorporation (Step 5) will be rejected. Please bookmark Article 3 in the NC statutes to get complete information on naming your non-profit organization. If needed, you can file an Application to Reserve a Business Entity Name that’s good for a decade as well.
Filing Fee: $30
All incorporated non-profits, 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 NC Registered Agent free of charge when you incorporate through IncFile or Incorporate.com. 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 Articles of Incorporation 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 one temporary director (more are recommended) to oversee the organization until in Step 7, you vote in 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 non-profit 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 Guidebook for Boards of Directors of North Carolina Non-Profit Corporations.
Bylaws are the rules/stipulations/regulations you write for how your non-profit will be governed and managed along with the many other formalities that come along with having a board of directors vs a non-profit 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 non-profit and get an idea of the paperwork-side of bylaws.
If you’re ready to officially form your non-profit corporation in the eyes of the law and public record, be sure everything is correct with your Articles of Incorporation and have your incorporators sign/file them with the state. There’s instructions on the document itself, but feel free to bookmark the entire Chapter 55a of the North Carolina Nonprofit Corporation Act because it outlines all the finer details.
At the link above it takes you to the Sec. of State site where you’ll be able to download a PDF file. Print it out and make sure you have a copy for your brand new corporate records book we’ll touch on in the next step.
Filing Fee: $60
While there are a variety of modern ways to track and compile your non-profit’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 non-profit/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 non-profit 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 “minute of meeting” take roll call, record everyone’s name, and have it signed by all attending directors then add this to your new records book.
Getting an EIN, or Employer Identification Number, is one of the easiest parts of this entire process. It’s a 9-digit number that’s used to keep track of your financial activity to ensure legality and compliance. Once you have one you can hire paid employees if needed, or a part of your organization, and set up an official bank account.
Almost every transaction your non-profit 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 non-profit 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:
Two other great resources it might be worth it to add to your bookmarks are the Charlotte district office of the Small Business Administration and the state’s Small Biz Development Center because they’ve got plenty of helpful information and connection to not only resources but the people of NC as well.
At first glance this might seem like a trivial step, but it isn’t. Far from it actually, because the differences from one bank to another, from one credit union to another, can be huge when you consider their impact (along with other financial services they offer non-profits) over the first three years. Consider fees, interest levels, charges for using this and that service, and everything else that happens with the money your non-profit deals with.
If this will be your first time setting up shop, a) check out this quick breakdown of Non-Profit Accounts, and b) make sure to keep this account completely separate from all other accounts. Don’t muddy the pristine water of your financials and put everything at risk of causing an audit by the IRS or wasting precious resources.
No matter what stage of non-profit development you’re in, if you plan on going “all the way” then you’re going to need to get down to some basics and plan accordingly. No serious initiative gets to extreme heights of impact without a game plan. That’s the honest truth.
What does this mean? It means a presentation/fund-ready plan that focuses on core fundamentals for the purpose of showing VC-types, lending institutions, potential partners, volunteers, donators, etc. Feel free to use LivePlan and the special discount they offer our readers to your non-profit’s advantage.
Start small, simple, and responsive then build over time only as your non-profit needs grow. Don’t spend $4000 on a site when you have no funding. Ideally, use volunteers and funding to build from a basic landing page or agency-style site into something much more extensive.
It’s about marketing potential. It’s about brand expansion. It’s about amazing impact and giving search engines a way to show your project or initiative to the world. If this is your first web design rodeo, consider using a website builder like Wix or Weebly, which completely simplify the process. Both are really easy to use and affordable.
Note that this article on how to form a non-profit organization in North Carolina isn’t a legal document or legal advice. It’s for informational purposes and the information above is subject to change. For specific legal questions regarding how to form a non-profit organization in North Carolina or business in general, please consult with a non-profit/corporate lawyer or other accredited professional.