Nonprofit Help Guides and Resources

Nonprofit Help Guides

Are 501(c)(3) nonprofit corporations required to make their financial statements available to the public?

Yes, nonprofit corporations are required to make their financial statements available to the public. Form 990 includes a nonprofit’s figures for revenue, expenses, assets, and liabilities, and all 501(c)(3) nonprofits are required to submit Form 990 to the IRS annually. The form also includes the salaries of the directors, officers, and executives o...

What is expedited filing?

Expedited filing is a popular option for corporations seeking to shorten the time it takes to receive approval of their articles of incorporation filed with the state. This option often results in time savings of two or three weeks, allowing the corporation to open its doors and start receiving revenue much faster. The requirements for using expedit...

What are corporate bylaws?

Think of corporate bylaws as an internal rulebook for the organization’s key decision-makers. They specify the corporate governance procedures, including how the board of directors and any committee members will be selected, when and how annual meetings will be conducted, and how to deal with conflicts of interest between the company and its decisio...

Can nonprofit corporations issue shares of stock?

Almost all states expressly prohibit nonprofits from issuing stock shares. This is because, unlike other types of corporations, nonprofits may not operate for profit. Therefore, there is no goal of increasing value for shareholders. Instead, profits get reinvested in the corporation. However, a few states do allow nonprofits to issue stock shares th...

What are articles of incorporation?

Articles of incorporation must be filed with the appropriate state division, typically the Secretary of State’s Office. Doing so will give the nonprofit corporate status and all the rights and privileges that come with it. At a minimum, you will need to have the following information available when completing the articles of incorporation: The name...

Can board members be paid as W-2 employees?

Although it is legal to have board members that are also paid as employees, it is often not in the best interest of the nonprofit and can lead to potential conflicts of interest between the person’s duties to act in the nonprofit’s best interest as a board member and his or her self-interest as an employee. For this reason, the vast majority of boar...

Who needs to approve corporate bylaws?

Although federal law does not require specific language in most organizations’ bylaws, some states require that bylaws be filed at the time of incorporation or shortly thereafter. In most states, corporate bylaws are simply approved by the board of directors at the first board meeting. The board approves subsequent amendments of the bylaws according...

What are the IRS requirements when starting a nonprofit corporation?

The IRS does not require nonprofit corporations to apply for exemption from paying federal income taxes. However, those that want to obtain this exemption must file Form 1023 within 27 months of filing their articles of incorporation. Also, most nonprofits must file the informational tax report, Form 990, annually. More information can be found on t...

How does a corporation protect my personal assets?

A corporation is considered to have separate “legal personality” from the people that own it—the shareholders. This means that a corporation has the ability to enter into and enforce contracts. Additionally, a corporation can also accrue debt and own assets. As a separate legal entity, if any creditors attempt to enforce a debt against a corporation...

When can nonprofits start soliciting donations?

Nonprofits in all but 10 states are required to register with the appropriate state division prior to soliciting donations in that state. The states that do not require registration as of 2016 are Delaware, Idaho, Indiana, Iowa, Montana, Nebraska, South Dakota, Texas (except for certain law enforcement, public safety, and veteran causes), Vermont, a...