How to Start a Nonprofit in Arizona

Two people forming a nonprofit in Arizona

In this guide, you’ll find everything you need to know about how to start a nonprofit in Arizona, including information on how to name your nonprofit organization, file articles of incorporation and how to apply for 501(c)(3) tax exempt status with the Internal Revenue Service (IRS). 

Or, simply use a professional formation service: four point eight out of five stars Northwest ($29 + state fee)

Starting a nonprofit organization in Arizona is easy

To start an Arizona 501(c)(3) nonprofit organization, you'll need to first register a nonprofit corporation with the state of Arizona, and then apply for tax exempt status under section 501(c)(3) with the Internal Revenue Service. 

You can learn more about nonprofits and 501(c)(3) in our What is a nonprofit? and What is a 501(c)(3)? guides. 

Want to form a nonprofit elsewhere? Read our other How to Start a Nonprofit guides. Also check out our best nonprofit formation services review.

Step 1: Name Your Arizona Nonprofit

The name you select for your nonprofit will establish its brand. It is the first thing most people will learn about your organization. It is important to pick a name that both aligns with your mission and follows the rules for naming in your state.

Arizona Nonprofit Naming Guidelines

If the name of your organization includes any of the following words you must first get written approval from the Arizona Department of Financial Institutions:

  • Bank; Banker; Banking; Banc; Banco; Banque; Credit Union; Deposit; Savings Association; Building Association; Savings and Loan Association; Building and Loan Association; Savings Bank; Thrift; Trust; or Trust Company

You can read the official guidelines for the complete rules on naming an Arizona-based organization.

To learn more, read our How to Name an Arizona Nonprofit guide.

Not sure what to name your business? Check out our Business Name Generator

Is the URL available? 

We recommend that you check online to see if your business name is available as a web domain. Even if you don't plan to create a business website today, you may want to buy the URL in order to prevent others from acquiring it.

Find a Domain Now

Now that you have verified your name and secured the URL you may select a professional service to complete the nonprofit formation process for you. 

We recommend: Northwest ($29 + state fee)

Step 2: Appoint an Arizona Statutory Agent

A nonprofit corporation in Arizona is required to have a Statutory Agent with an Arizona address.

What is a Statutory Agent? A Statutory Agent is an individual or business entity responsible for receiving important legal documents on behalf of your business. Think of your Statutory Agent as your business' point of contact with the state.

Learn more about Statutory Agents

Northwest provides the first year of registered agent service free with nonprofit formation ($29 + State Fees)

To learn more, read our How To Pick an Arizona Statutory Agent guide.

Step 3: Select Your Board Members and Officers

The directors of a nonprofit are responsible for overseeing the operations of the organization. The directors come together to form a board.

The officers of a nonprofit (such as the president or the secretary) are individuals with responsibilities, and the authority to execute based on their job descriptions.

Together, the officers and the board will come together to make up the organizational structure of your nonprofit.

To be eligible for 501(c)(3) status, the organization structure of your Arizona nonprofit corporation MUST include:

  • At least 3 directors not related to each other
  • At least 1 officer who is responsible for recording meeting minutes.

To learn more, read our guide on how to select board members for your nonprofit.

Step 4: File the Arizona Articles of Incorporation

To become a nonprofit corporation in Arizona you must file the Articles of Incorporation with the State of Arizona.

In order to qualify for 501(c)(3) status, the organization’s purpose must explicitly be limited to one or more of the following:

  • Charitable
  • Religious
  • Scientific
  • Literary
  • Testing for public safety
  • Fostering national/international amateur sports competition
  • Preventing cruelty to animals/children

You will need to mail the following to the Arizona Corporation Commission:

Arizona Corporation Commission
Corporations Division
1300 W. Washington St.
Phoenix, Arizona 85007

Information: (602) 542-3026

To learn more, read our guide on How to File the Arizona Articles of Incorporation

Step 5: Draft Bylaws and Conflict of Interest Policy

There are two documents that will be central to the running of your nonprofit:

Bylaws: These are the rules that determine how your organization will be governed and run.

Conflict of Interest Policy: These are the rules set to ensure that decisions being made for the nonprofit are based on what is best for the organization, and not being motivated by what is best for individuals.

Learn more about how to write bylaws for your nonprofit

Step 6: Conduct an Organizational Meeting

An organizational meeting is the first official meeting of your nonprofit! Some of the things that are discussed in a typical organizational meeting:

  • Taking attendance to show you have a quorum (minimum number needed)
  • Appointing temporary officers, chairmen, secretaries, etc.
  • Adoption of the bylaws
  • Adoption of conflict of interest policy

Don’t forget to record “minutes” of the meeting and have it signed by all attending directors. Here are some corporate minutes templates to help you get the ball rolling.

Step 7: Get an EIN

An EIN or Employment Identification Number (also called a Federal Tax Identification Number or Federal Employment Identification Number), is used to uniquely identify a business entity. You can think of the EIN as a social security number for your nonprofit.
The EIN is required for your organization whether or not it will have any employees.

To learn more, read our guide on how to get your EIN.

Step 8: Applying for Exemption from Federal (501(c)(3) status) and State Taxes

Applying for Exemption from Federal Taxes:

A nonprofit may be eligible for 501(c)(3) status only if its purpose is limited to one or more of the following:

Charitable, Religious, Scientific, Educational, Literary, Fostering national/international amateur sports competition, Preventing cruelty to animals/children, Testing for public safety

Before a nonprofit can apply for 501(c)(3) status it must:

  1. Elect at least 3 directors not related to each other
  2. Register as a nonprofit with the state
  3. Adopt the bylaws and conflict of interest policy
  4. Have an EIN number

Once these four conditions have been met your nonprofit can apply for 501(c)(3) tax-exempt status by filing Form-1023 online.

If your application is approved, the IRS will send you a determination letter stating that your organization is exempt from federal taxes under section 501(c)(3).

To learn more, read our guide on How to File Form 1023-EZ.

 

Applying for Exemption from State Taxes:

If your nonprofit has received a Letter of Determination from the IRS declaring it as a 501(c)(3) organization, it is automatically exempt from corporate income taxes in Arizona.

You can read more about it on the Department of Revenue website.

Arizona Department of Revenue
Corporate Income Tax Audit
1600 W. Monroe
Phoenix, Arizona 85007-2650

Information: (602) 255-2060

https://azdor.gov/

Once you have formed your Arizona nonprofit, we recommend you read our guide on How To Protect your Arizona Nonprofit and Keep It Compliant.

Step 9: Open a Nonprofit Bank Account

After you acquire an EIN and a federal tax exemption for your nonprofit, you can open a 501(c)(3) bank account to begin soliciting donations or paying vendors and employees of the organization.

Opening a bank account for your nonprofit is the first step towards creating a paper trail of all income and expenses to show the IRS that your nonprofit is legitimate, honest, and legal.

There are several rules and exceptions that differentiate a 501(c)(3) bank account from a traditional business account. To find the best bank for your organization's financial needs read our review of the best banks for small business.

Step 10: Get Insurance for your Nonprofit

A nonprofit has assets and can be the subject of legal action or suffer financial damages from accidents, just like a regular business.

We recommend Tivly to protect your organization from lawsuits and damages.

Find out the real cost of getting insurance for your nonprofit. Get a free quote or call 855-965-3168.