Okay, there’s a handful of things you need to know as you start tackling your non-profit organization’s name. First, it must be unlike any other registered name with the state – conduct a Business Entity Search to see if there are any naming conflicts. Also, the name can’t be deceptive and imply your non-profit does anything other than what you’ll state in your Articles of Incorporation in Step 5.
If you want to read through the codes yourself, see Title 33 – Ch. 31 – Article 4. If needed, and once you know the name is available, you can file an Application to Reserve Corporate Name with the state and protect it for 120 days while you prepare bylaws, articles, etc.
Filing Fee: $10
All business entities need to have a registered agent for, well, essentially one reason – so they can’t say, “We never received that document.” to any state or federal agency. It will be your agent’s responsibility to officially receive and provide “Service of Process” to all state filings, tax documents, legal notices, and so on. This is why they must have a SC address, be registered/certified with the state, and hold regular business hours.
That said, you can hire an outside professional and spend up to $160/yr, or get a registered agent free of charge for the first year when you incorporate with IncFile or BizFilings. It’s a service we highly recommend to new non-profits that need help but can’t afford legal assistance.
South Carolina requires a minimum of 1 incorporator – the individual(s) who are responsible for signing and often filing the Articles of Incorporation with the state. Pretty straightforward. However, if your non-profit will be governed by a Board of Directors vs. members things can get more interesting.
Initial Directors are recruited to oversee the non-profit while it’s being formed, then when you conduct your initial meeting in Step 7 directors are voted on/in. There is no maximum and they don’t need to be listed in Articles, but if they are they’re going to need to sign. If possible it’s a good idea to either hire the best non-profit lawyer you can afford or partner with professional incorporation services who can provide expert assistance in terms of incorporators and directors.
Your non-profit bylaws are your rules. They determine how your organization is governed and structured. All incorporated non-profits need them because if they aren’t in place the default state rules take over which may not be helpful. Common bylaws cover topics like:
If this is all new to you, use this savvy Corporate Bylaws Template which you can customize for your non-profit and get an idea of the paperwork-side of bylaws.
Once all the previous steps are covered, and you and your board/members are ready, incorporators should sign and file Articles of Incorporation with the Sec. of State. Information you’ll need includes:
Filing Fee: $25
If you’re audited, a corporate or non-profit records book/binder is what you’ll need to show the IRS. 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, receipts of major transactions, and so on.
As the name of the book implies, it’s a record holder of your SC 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.
Also called the organizational meeting, the first meeting of the board of directors marks the beginning of your South Carolina non-profit. In this meeting, you must decide on important matters including:
Make sure that you prepare the minutes of the meeting; your attending board of directors will need to sign the document. If needed, check out this great Corporate Minutes Template which you can customize.
What’s an EIN? For all legally registered business entities, as well as non-profit entities, they are a 9-digit federal “Employer Identification Number.” It’s used to track your business activity to ensure compliance, allow you to set up an official bank account, legally hire team members/employees, and so on.
While in the past it used to be a bit of a pain, these days you can get one quick, free, and easy by submitting an application online directly through the IRS Website.
Now’s the point to ensure your non-profit is 100% compliant in terms of not only licenses/permits, but state and federal taxes. You should be able to apply for tax exempt status now that the corporation is established.
Three other great resources to bookmark are the Columbia district office of the Small Business Administration, the state’s Dept. of Commerce page, and Publication 557 from the U.S. Dept. of the Treasury.
When you form a non-profit, it’s very important to keep all personal and business assets/accounts completely separate. So don’t take this lightly. Where should you start building the financial persona of your project/initiative? Who is offering the best overall services to corporate/non-profit clients, relative to location and other conveniences?
Start brushing up if all this is unfamiliar territory. Where your non-profit banks is a critical move, which is why it should be discussed at length in your initial meeting.
Without very precise planning/strategy it’s likely you’ll a) lose your exempt status and b) find it incredibly difficult to attract the kind of supporters it takes to really grow a non-profit into an organization with serious impact. That being said, these days there’s amazing software solutions that simplify the process for those of us without MBAs.
If you need help putting a solid strategy together, we’re huge fans of a tool called LivePlan. It’s been used by over 400,000 entrepreneurs and offers our readers an exclusive discount when they try it out.
If you don’t already have a website published, let’s get that ball rolling. Not having a website really isn’t an option anymore and if this is all brand new to you, you’ll be surprised how affordable it can be.
Note that this article on how to form a non-profit organization in South 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 South Carolina or business in general, please consult with a non-profit/corporate lawyer or other accredited professional.