- Step 1: Write a mission statement Write a mission statement. The mission statement should include the organization's goals, values, and vision.
- Step 2: Create and sign the articles of incorporation Assemble board members, if you have a board, to create and sign articles of incorporation.
- TIP: Board members should have the same goals, values, and vision as the organization.
- Step 3: Agree on bylaws Agree on bylaws that stipulate how the board will operate. All members must sign these laws as well.
- TIP: Bylaws should include each member's position, job requirements, and attendance schedule.
- Step 4: Incorporate your organization File for incorporation with your state government. Each state will have its own requirements, but you are usually required to prove that shareholders won't receive company profits.
- Step 5: Complete Form 1023 Complete Form 1023, Application for Recognition of Exemption. Download a blank file of the form from the Internal Revenue's web site at irs.gov. There is a fee of up to $850 to file a Form 1023.
- TIP: Hire a lawyer to complete the form, or at least review it, if you have concerns about accuracy.
- Step 6: Wait Wait for your letter of approval. After receiving the letter, apply for tax-exempt status if you qualify, and then for exemptions from your state and for property tax exemptions from the city.
- FACT: Donor lists for nonprofit organizations are generally not public information, but annual return figures are.
You Will Need
- Mission statement
- Board members
- Articles of incorporation
- Application for Recognition of Exemption (Form 1023)
- Internet access
- State and local applications
- Lawyer (optional)