A 501(c)(3) organization, which are formed for religious, charitable, scientific, literary or educational purposes, is eligible for federal and state tax exemption. But before you can have a tax exempt organization, you need to create an organization in New York. Here is what you need to do to create a organization in New York.
Creating a Nonprofit Organization in New York
- Choose Directors
Choose 3 initial directors over the age of 18, preferably people who live in New York.
- Select a Name
Choose the name of your nonprofit corporation that is distinguishable from the name of any other corporation. To assist you, New York's Department of State has a business name search database of New York businesses to determine whether your name is available.
- Select the Address
Determine the address and location of your New York nonprofit to create a Certificate of Incorporation to be filed with the State of New York.
- Articulate the purpose of your nonprofit for your Certificate
This can be tricky because it must contain more than what your nonprofit's purpose actually is. An insufficient statement of purpose that does not meet either state or federal requirements will delay creating your organization and obtaining tax exemption. Your attorney should have boilerplate language available for you to utilize that should pass all levels of scrutiny.
- Prepare bylaws
Before you file your certificate, you will need to have bylaws that comply with New York law that contain rules and procedures for holding meetings, electing officers and other corporate formalities that your nonprofit will need to follow. While you need not file your bylaws, they will be needed later on when you file for tax exemption.
- Set up a Records Binder
Your New York attorney should organize your important documents and provide a record binders for future documents like minutes, resolution and other important documents that will be accumulated over the time your New York nonprofit is operating.
- Select the Type of Nonprofit
Determine the type of nonprofit you are filing, as defined by the law:
- Type A nonprofits are formed for any lawful non-business purpose or purposes including, but not limited to, any one or more of the following non-pecuniary purposes: civic, patriotic, political, social, fraternal, athletic, agricultural, horticultural, animal husbandry, and for a professional, commercial, industrial, trade or service association;
- Type B nonprofits are formed for any one or more of the following non-business purposes: charitable, educational, religious, scientific, literary, cultural or for the prevention of cruelty to children or animals;
- Type C nonprofits are formed for any lawful business purpose to achieve a lawful public or quasi-public objective, which must be explained in a separate statement identifying the lawful public or quasi-public objective which each business purpose of the corporation will achieve;
- Type D nonprofits are formed when authorized by any other corporate law of New York for any business or non-business, or pecuniary or non-pecuniary, purpose or purposes specified by such other law, regardless of whether its purposes are also with Type A, B or C.
*Gene Berardelli may be contacted at: GeneBerardelli@ipglegal.com
Gene is a New York street-smart attorney with an extreme passion for success. Gene specializes in litigation, arbitration and general corporate law for New York-based and international clients. He, also, is the host of a popular New York talk radio program.