Non Profit Organization 501(c)(3)

I recently went through an exercise of setting up a non profit organization . Tax Exempt 501(c)(3) organization from IRS’s perspective.

The process of setting up a Non Profit Organization is pretty complicated. But you don’t need to pay 600 dollars to a lawyer also to do this stuff for you. Overall the steps are as follows :

1. Setup a Corporation in the state where you want to conduct non profit activities. For me it was North Carolina. Basically, submit the articles of incorporation to your state’s Secretary of State. For N.C please visit. They even have a template of Articles of Incorporation for Non Profit Organization.

2. Request EIN number from the IRS. You can do this online here

3. Once the state authorizes your “Articles of Incorporation”, apply for Tax Exempt Status at the State and Federal (IRS) level. The only way I found out that my application was accepted was to search on their website (mentioned above) for my incorporation’s name. They did not send me a letter confirming that my application was accepted. But when I checked their website, I could download a stamped copy of my articles of incorporation (proving that my application was accepted)

3a.
For N.C. state exemption they sent me a form which was very easy to fill.

3b.
However, to get Tax Exemption (501c3) status from IRS is a different ball game. I strongly suggest you to please refer “How to Form a Nonprofit Corporation” book from Nolo (ISBN : 9781413306477)

This book takes you through a step by step process on how to fill Form 1023 (Application for Recognition of Exemption)

Time lines :

Article of Incorporation Acceptance : 4-6 weeks

EIN : Instant

N.C. State Exemption : 4-6 weeks.

Federal : Applied for in August’ 07, received in April’ 08.

Comments, Suggestions, Questions are always welcome

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