Non-Profit Formation

Check Our Video Presentation And Learn How to Start a NON-PROFITS Organization

Like starting any other business, when forming a non-profit organization, you need a plan and prepare a mission statement. For small non-profits organizations the IRS offers an expedite program that grants 501(c)3 exempt status in approximately 90 days.

In addition to the standard requirements involved in starting any business, to form a nonprofit you need to:

  • Get an Employer Identification Number (EIN).
  • Form a Board of Directors.
  • File Your Founding Documents.
  • Apply for 501(c)3 tax exemption with the IRS.

There are three basic types of nonprofit organizations:

  • Informal Non-profit Organizations
  • Incorporated Non-profit
  • Tax-Exempt Organization

Informal Non-profit Organizations

You can form an informal non-profit, simply by getting together with other people to provide support or services to benefit others. There are no special benefits in being an informal non-profit, other than personal satisfaction in helping others, but there may be certain legal liabilities as you conduct charity activities without incorporating and the members’ or donors’ contributions are not tax deductible. This type of non-profit organization is not obligated to file tax returns.

Incorporated Non-profit Organizations

This type of nonprofit is formed by incorporating in a particular state to form and be recognized as corporation. A corporation takes the place of individual ownership. The corporation owns itself, and therefore, can own its own property, have its own bank account, take out its own loan, and can continue on its own even if the founder leaves the organization. One of the major benefits of incorporation is that the corporation takes on legal liability and financial risks so that founders, officers, and board members have little or no liability and with the exception illegal acts, or gross fiscal misconduct. Members’ or donors’ contributions are not tax deductible and the non-profit organization must keep a detailed records of the use of contributions received in case the IRS chooses it for an audit. This type of non-profit organization is not obligated to file tax returns.

Nonprofit corporations may be formed to benefit members of an organization, a club, a mutual benefit society or for some public purpose such as a disaster relief, social assistance programs, or youth development programs and can be classified in many ways, including as a public benefits corporation, public charity, or educational foundation. 

Tax-Exempt Organizations

Nonprofit corporations must file with the IRS as a separate step in order to receive tax exempt status. An organization cannot receive tax exemption unless it was first formed as a corporation with an accepted charitable structure and purpose. This type of non-profit organization is obligated to file tax returns if donations are over $50K per year also need to and include a detail of each donor to validate it with the IRS. Members’ or donors’ contributions are tax deductible and the non-profit organization must keep a detailed records of the use of contributions received in case the IRS chooses it for an audit.

The deadline for tax filing is May 15. The time frame for the approval of the exempt application with the IRS is 90 days if all requirements are met. Not all nonprofit organizations are eligible for tax exempt status.  Good news is, our experienced team can give you advice and help you with completing the right application forms, which will be most time and cost-effective. 

The IRS charges $400 for the application if planned donations are limited to $40K per year and $750 if they are over $40K per year.

To start the filing process you need a non-profit company established in your state:

  • Articles of Incorporation
  • Employer Identification Number
  • By-laws of the Organization
  • Minutes of Board Meetings
  • Names, Addresses, and Resumes of Board Members
  • Names and addresses of all Active Members
  • Inventory of Assets
  • Inventory of Liabilities

Our Non-Profit Services Includes:

Silver

Setup Fee

$3.5K

Non-Profit Silver Package

Non-Profit 501(c) 3 Exemption Application

Gold

Setup Fee

$5K

Non-Profit Gold Package

Non-Profit 501(c) 3 Exemption Application
Company Incorporation

Platinum

Setup Fee

$6.5K

Non-Profit Platinum Package

Non-Profit 501(c) 3 Exemption Application
Company Incorporation
Tax Return Filing 1 Year

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