STEPS TO
FORMING A NOT-FOR-PROFIT ORGANIZATION
1. Determine
the Purpose of the Organization
Every organization should begin with a written statement that expresses its reason for
being.
DONE!!!
2.
Form a Board of Directors
The initial board will help translate the ideas behind the organization into reality
through planning and fundraising. As the organization matures, the nature and composition
of its board will also change.
DONE!!!—I’m
going to say that we are the board for now and I think that we should revise the
composition of this board 1 month before we open our doors.
This will allow us to move forward quickly to take care of the BS and then
bring in others when there is something more to talk about.
ALL—BRAINSTORM PEEPS THAT WE WOULD LIKE ON THIS BOARD. (BILL DO YOU HAVE THAT LIST WE MADE THAT NIGHT?)
3.
Find a Lawyer
This is not a mandatory step, but it will definitely ease the process.
BILL—CAN
YOU DO THIS BY TUESDAY? AND FOLLOW UP WITH
RAMSEY AND SEE IF HIS FAST-TRACK FOR THIS IS STILL LEGIT.
4.
Draft Articles of Incorporation and File Certificate of Incorporation
To become a not-for-profit organization, the organization must file a Certificate of
Incorporation with its state. At that point, the organization's corporate existence
begins.
Charity Regulators by State
Sample Articles of Incorporation
SARA—BY
RETURN FROM BREAK, DRAFTED AND THEN WE’LL RUN THEM THROUGH THE HOOPS IN JAN. FOLLOW THE LINKS…DOESN’T LOOK TOO BAD.
5.
Draft Bylaws
Bylaws are the operating rules of the organization. They should be drafted and approved by
the board early in the organization's development.
KELLY—BY
THE RETURN FROM BREAK…FOLLOW THE LINKS AND WE SHOULD BE COOL…BE CREATIVE! HAVE FUN!!!
6.
Develop a Strategic Plan
The strategic planning process helps you express a vision of the organization's potential.
Outline the steps necessary to work toward that potential, and determine the staffing
needed to implement the plan. Establish program and operational priorities for at least
one year.
Strategic Planning FAQ
Guide to Preparing a Business Plan
BRENT—BY THE
RETURN FROM BREAK…BUT ONLY AFTER HAVING TALKED WITH BILL TO SEE IF WE SHOULD SPLIT
THE WORK.
7.
Develop a Budget and Resource Development Plan
Financial oversight and resource development are critical board responsibilities. The
resources needed to carry out the strategic plan must be described in a budget and
financial plan.
Guide to Budgets and Budgeting
BILL—BY
THE RETURN FROM BREAK…MOSTLY DONE (AND ATTACHED).
WE SHOULD JUST GET EVERYTHING A BIT MORE FIRM.
8.
Establish a Record keeping System for the Organization
Corporate documents, board meeting minutes, financial reports, and other official records
must be preserved for the life of the organization.
BRENT—BY
THE END OF BREAK…SET UP BINDER SYSTEM THAT IS INFALLIBLE.
9.
Establish an Accounting System
Responsible stewardship of the organization's finances requires the establishment of an
accounting system that meets both current and anticipated needs.
BILL—UMMM…I
DON’T EVEN KNOW WHAT THIS MEANS, BUT I THINK THAT YOU MIGHT. HAVE A SKETCH OF A PLAN BY END OF BREAK.
10.
Apply for an Employer Identification Number from the IRS
All businesses are required to have an Employer Identification Number (EIN). File IRS form
ss-4 to get an EIN. It will go on all forms and all communications with the IRS.
IRS Tax-Exempt Organizations Tax Kit
BRENT—TO BE COMPLETED BY END OF BREAK.
11.
File for an IRS Determination of Federal Tax Exempt Status
A not-for-profit organization with charitable, educationals, scientific, religious, or
cultural purposes must receive permission form the Internal Revenue Service to be treated
as an exempt organization. To receive permission, the organization must obtain Form 1023
and Publication 557 from the Internal Revenue Service. If Form 1023 is filed within the
first fifteen months of its formation, the organization may be treated as an exempt
organization since inception. If the form is filed after fifteen months, the organization
will not receive exempt status until a future year. If this form is not filed, the
organization will be liable for taxes on any taxable income that the organization
generates. If an individual chooses not to incorporate, the business activity will be
reported on their individual tax return as profit or loss from business (sole proprietor).
The individual will be subject to taxes on any profit that the unincorporated business
generates.
IRS Information for Tax-Exempt Organizations
Form 1023 Help
Sample Form 1023
BRENT—TO
BE COMPLETED 1.472 WEEKS FROM RETURN FROM BREAK (IF NOT SOONER). I THINK THAT WE MIGHT HAVE TO GET ALL OUR STUFF
TOGETHER FOR THIS TO ACTUALLY HAPPEN
12.
Files for State and Local Tax Exemptions
In accordance with state, county, and municipal law, apply for exemption from income,
sales, and property taxes.
BRENT—TO BE COMPLETED 1.487
WEEKS FROM RETURN FROM BREAK (IF NOT SOONER). I
THINK THAT WE MIGHT HAVE TO GET ALL OUR STUFF TOGETHER
13.
Meet the Requirements of State, County, and Municipal Charitable Solicitation Laws
Many
states and local jurisdictions regulate organizations that solicit funds within the state,
county, or city. Usually compliance involves obtaining a permit or license and then filing
an annual report and financial statement.
BRENT--TO
BE COMPLETED 1.491 WEEKS FROM RETURN FROM BREAK (IF NOT SOONER). I THINK THAT WE MIGHT HAVE TO GET ALL OUR STUFF
TOGETHER
14.
Obtain Directors' and Officers' Liability Insurance
SARA—CAN
YOU FIND OUT WHAT THE HECK THIS IS AND DO IT WITHIN A REASONABLE TIME?
15.
Apply for a Not-For-Profit Mailing Permit from the
KELLY—TO BE COMPLETED BY THE END OF BREAK. I’M NOT SURE WHAT THIS ENTAILS, BUT YOU SHOULD
AT LEAST BE ABLE TO GET AN APPLICATION AND SEE WHAT WE NEED.