Forming a nonprofit corporation in New York is not so difficult after some basic understandings of the the types of nonprofit businesses in New York and an understanding of the basic formalities.
501(c)(3) Nonprofit Organizations in New York
A 501(c)(3) organization, which are formed for religious, charitable, scientific, literary or educational purposes etc., is eligible for federal and New York state tax exemption. But before you can have a tax exempt status in New York, you shall need to create a non-profit organization in New York.
Please note below are the basic steps for forming a nonprofit corporation in New York. Please note this list is not an exhaustive explanation and you should also take a look at:
Registering your Nonprofit Corporation for Fundraising in New York.
Creating a Nonprofit Organization in New York
- Choose Directors
Choose three initial directors over the age of 18. In many cases, it is advantageous to have those residing in New York as directors.
- Select a Name
Choose the name of your New York non-profit corporation that is distinguishable from the name of any other corporation. To assist, 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. The address is required to issue a Certificate of Incorporation to be filed with the State of New York.
- Articulate the purpose of your nonprofit for your Certificate of Incorporation
This can, sometimes, 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 New York State or U.S. Federal requirements shall delay creating your organization and obtaining tax exempt status. Your attorney in New York should have boilerplate language available for you to utilize that should pass all levels of scrutiny.
- Prepare bylaws
Before you file your New York Certificate of Incorporation, you should have bylaws that comply with New York law that contain rules and procedures for holding meetings, electing officers and other corporate formalities. While you need not file your bylaws, they shall 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, resolutions 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 New York law:
- NY Nonprofit Type A: nonprofit 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;
- NY Nonprofit Type B: nonprofit 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;
- NY Nonprofit Type C: nonprofit 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; or
- NY Nonprofit Type D: nonprofit 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 within Type A, B or C.
Your New York attorney shall, also, likely request other documents for the processing of the non-profit incorporation. No worries, with a proactive attorney – most matters go fast and smoothly. Please, however, consider having a lawyer assist in getting all major compliance systems in place in order to assist in avoiding the scrutiny of the various New York government agencies that enforce a myriad of New York laws.
- NY State and Federal Tax Exemption for your New York Nonprofit
- Registering Your New York Nonprofit For Fundraising Purpopses
- IRS 501(c)(3) Organizations vs. IRS 501(c)(4) Organizations: New York Non-Profit Law Basics
- Challenges to Starting a Business in New York City
- Factors to Consider When Forming a Corporation in New York
- New York S Corp vs. LLC Basics: Choosing your Corporate Entity in New York