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starting a non profit organization

Starting a Non Profit Organization

Starting a Non Profit Organization

When starting a non profit organization it is important to understand exactly what purposes it can serve and the steps to create it. When starting a non profit organization you must understand it is a not for profit group that centers its focus on charitable causes.  Its funding comes from donations that are given by individuals, businesses or granting organizations.  Acquiring funding through fundraising activities is key for a non profit.  This is done instead of issuing stock to raise capital like its for profit counterpart.  The donations given to a charity must be used on itself or given to other charities.

As defined by the IRS a charitable purposes for a non profit organization can be spiritual, academic, scientific, literary, testing, public protection, cultivating, national or international amateur sports levels of competition and stopping harshness to children or animals.

Starting a non profit organization is a bit different in its operations than a for profit corporation.  A common misconception of a non profit is that it can not accumulate funds. Just like any corporation, a charity can gain funds, pay staff, and use the funding it has to run its ongoing operations.  The difference when starting a non profit organization is its funding is gained from donations, and as stated above, its purpose is charitable.

Creating a non profit is something many start out to accomplish but many stop short of completing their goal. One of the primary challenges many have starting the organization is the difficulty with the creation process.  The creation is not as difficult as many perceive it to be and within a few steps the organization can be created and fundraising can begin.  Below are the basic steps in starting a non profit organization.

Primary Task to Complete to Form When Starting A Non Profit Organization

1. Create Articles of Incorporation and file them in the state the non profit will do business

2. File for an Employee Identification Number

3. Construct Non Profit Bylaws (rules to conduct the business with)

4. Take the filed Articles of Incorporation to a bank to open a bank account

5. Select Board Members to serve on its governing board

6. If the organization desires to be tax exempt fill out the IRS 1023 form and file it

More detail on these steps are covered at the page here or use the navigation on this website.

Each of the steps are elementary and is all that is needed to form the entity.  When filling out the IRS 1023, if the process becomes difficult simply consult an expert who can make sure you get this form filled out correctly.  Because it is filed with the IRS, and can create delays when starting a non profit organization and it is important to have this form filled out right.

One excercise that can keep the creation of the charity moving smoothly is to create the basic information on the organization before attempting the steps above.  This will help you have the organizations information complete and then is simply a matter of creating the documents.

The Information Needed In Starting A Non Profit Organization

1. Name


3. Phone Number

4.Fax Number

5. Email address

6. Purpose Statement

7. Brief Mission Statement

8. Board Member Resumes

9. 3 Year Budget

10. Funding Plan to Raise Donations

11. The Way the Organization is Structured

12. How the Programs Will Be Structured

The process of creating the key documents for the non profit will go smoother by having the above information easily accessible.  All the steps above are neccessary in creating an independent non profit.  There is a quicker, easier and less expensive approach to forming a non profit through fiscal sponsorship.  Fiscal sponsorship is obtained by finding an existing non profit organization willing to include your projects in its organization.  More information on fiscal sponsorship can be found by clicking on the Start A Nonprofit link in the top navigation.

Creating a non profit can be a straightforward and simple task.  Because we want you to be successful in either creation of an independent non profit or a fiscally sponsored one there is an exhaustive resource called the Simple Nonprofit Starter Bundle available on this website that will walk you step-by-step through the creation and funding of either.  Following the simple steps above will have you on your way to starting a non profit organization in little time.
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About the Author

SimplenonprofitEntrepreneur of ideas, innovation, creativity and solutions. An innovation master that brings fresh and inspirational solutions and strategies to difficult challenges. Thrives in new ventures and embracing challenges with a custom solutions, strategies, buyers or sellers.  Highly motivated and vision-oriented team player with abilities to communicate, lead, and successfully build strong teams to accomplish objectives. Consistent in bringing balance, teamwork, individual creativity, challenging work, and a stable environment to projects. Brings 26 years experience providing Strategic Development, Management Solutions, Sales Development, and Marketing in diverse business settings. Extensive background and Senior Level Management in regards to Strategic Business Development, Key Account Management, Marketing, Sales, and implementation of various projects in the U.S., South America, and the Caribbean. View all posts by Simplenonprofit »

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