How to form a 501(c)(3)
nonprofit corporation.
A nonprofit corporation is purpose-driven.
A company whose goal is not to make profit for themselves.
Typically they are an organization that wants to make money
in order to help further a social cause
or provide a public benefit.
Let's get you started on the right path
to forming a nonprofit corporation in Alaska.
If you're not sure what a non-profit is.
Check out our other video.
What is a nonprofit, linked below.
How do you form a nonprofit corporation?
There are two ways, you can do it yourself
or you can hire a service to do it for you.
Let's take a look at both options
and help you decide how to go about forming
your own nonprofit corporation.
Option one, do it yourself.
If you want to save money, you can form
a nonprofit corporation on your own.
Let's take a look at the six steps
to forming a nonprofit corporation on your own.
One, choose and secure your nonprofits name.
The name you select for your nonprofit
will establish its brand.
It's the first thing most people will learn
about your organization.
It's important to pick a name that both aligns
with your mission and follows the rules
of naming guidelines in Alaska.
You'll need to check Alaska specific name or requirements,
but in general, follow these rules when choosing a name.
The name you picked for your organization
should not include any words or terms
that could be considered grossly offensive or misleading.
The name must be distinct
from that of any other corporation in Alaska.
For more information on what makes a name distinct,
check out our other video,
how to name your business on Alaska, linked below.
Once you have a name selected
do a name search to make sure it's available in Alaska.
After doing an Alaska named search
you'll want to do a domain search to see
if your name is available as a URL.
Even if you don't plan on making a website today
you may want to secure the URL.
So someone else doesn't take it
Two, appoint of registered agent.
The registered agent can be an individual
within the company, including yourself,
or you can hire a professional service authorized
to do business in Alaska.
They will send and receive legal papers on your behalf.
These documents include official correspondence
like legal summons and document filings
which your registered agent will receive and forward to you.
Your registered agent will also help remind you
to file the necessary reports.
Failure to properly maintain your nonprofit
can result in fines and disillusion.
So this assistance is valuable.
Three, select directors and officers.
Your nonprofit corporation will be made up
of some number of directors and officers.
The directors of a nonprofit are responsible
for overseeing the operations of the organization.
Together they formed the board of directors.
The power and influence of the directors
over the organization comes from them as a board.
The directors themselves do not have any
authority as individuals.
The board typically creates the policies
that govern the nonprofit.
They also oversee management level hiring
such as the company officers.
The officers of a nonprofit such as the president
or secretary are individuals with responsibilities
and the authority to execute based on their job description.
Together the officers on the board will come together
to make up the organizational structure of your nonprofit.
An officer may also be on the board of directors
and serve both roles if allowed to do so
by the organizational bylaws, which we will discuss later.
The organizational structure of your nonprofit
in Alaska must include at least three directors,
not related to each other, a president,
a vice president, a secretary and a treasurer.
note that the president and the secretary position
can not be held by the same person.
To learn more, read our guide on how to select board members
for your nonprofit, linked below.
Four, file the articles of incorporation.
To form a nonprofit corporation
You will need to file official papers with Alaska.
In Alaska, This is called the articles of incorporation.
Some possible information in the articles of incorporation.
You may have to include is, name of the corporation,
disclosure of corporate purposes,
registered agent and registered office,
directors and supplemental provisions and information.
For more information on the sections
in Alaska's articles of incorporation.
Check out our page, linked below.
Five, operating procedures and housekeeping.
Once your nonprofit corporation has been formed
you'll want to start getting the structure of it together
and determine how your non-profit will be run.
Starting with the bylaws and conflict of interest policy.
Your bylaws are the rules that determine how
your organization will be governed and run.
You can think about it as a constitution for your nonprofit.
It makes the rules and priorities clear
for everyone involved.
in your bylaws, be sure to include
how the nonprofit will be governed,
the roles of directors and officers,
how meetings are held, voting procedures,
electing officers or directors,
how records will be kept and managed,
how disputes will be handled
and how bylaws will be added and amended in the future.
When you're ready to get started
check out some bylaws templates,
Link in the description below.
The conflict of interest policy are the rule set to ensure
that decisions being made for the nonprofit are based
on what is best for the organization
and not being motivated by what is best for individuals.
You'll want to make sure you have a draft
of both the bylaws and conflict of interest policy.
Before your organizational meeting.
We have templates of both bylaws
and conflict of interest policy,
link in the description below.
An organizational meeting is the first
official meeting of your nonprofit.
Some of the things that are discussed
in a typical organizational meeting are,
taking attendance to show you have a quorum,
appointing temporary officers and chairman,
adoption of bylaws and adoption
of conflict of interest policy.
It's important to record minutes of the meeting
and have it signed by all attending directors.
We have some corporate minutes templates
linked below to help you get the ball rolling.
After your nonprofit has been formed,
you'll need to apply for an EIN
or employment identification number.
An EIN is like a social security number for your nonprofit.
And it's used for things like filing
for 501(c)(3) status, opening a bank account,
applying for tax exempt status and submitting tax returns.
For more information on EINs,
check out our other video, linked below.
Since you will be starting a nonprofit
in the state of Alaska, you will need to file
for separate tax accounts for each applicable tax type
based on the structure of your organization.
Learn more on the Alaska department of revenue
tax division's website or contact them for more information.
Both the website and contact information are linked below.
Six, apply for 501(c)(3) status, federal tax exemption.
What is federal tax exempt status?
And why do you want it?
When a corporation generates income,
that corporation has to pay a federal income tax.
As a nonprofit your goal is to generate income
that is used to help further a cause
rather than fill the pockets of the company employees.
Because of this the federal government allows
that nonprofits income not be taxed
so that more of the money can go towards
the cause of the nonprofit is supporting.
Before your nonprofit can apply for 501(c)(3) status.
it must file the articles of incorporation
with the required provisions, adopt the bylaws
and conflict of interest policy and have an EIN number.
In order to file for tax exempt status
most organizations will need to file form 1023 online
or by mail and pay a fee of $600.
If your organization's annual gross receipts
are below $50,000, then you may be able
to file form 1023-EZ with a fee of $275.
You can check your eligibility
with the link in the description below.
Once you've received your 501(c)(3) determination letter
from the IRS, your non-profit will be automatically exempt
from state income tax.
option two.
The second way it's a form of nonprofit
is to hire a professional service,
to create your nonprofit for you.
Hiring a professional service to file your forms
and act as your registered agent for the nonprofit
will cost you an additional 50 to $150.
This the only covers formation of a nonprofit corporation.
If you wish for the professional service to file
for 501(c)(3) status the cost may go up
to as much as $1,700 plus filing fees.
However, there are several benefits to working with a pro.
A hired registered agent helps with getting
your reports filed on time, helps you stay organized
by keeping your business mail separate
and is available at all regular business hours
to accept official mail and legal papers
on your nonprofits behalf.
If you want to form an organization or company
in Alaska with the purpose being to help a cause
rather than make a personal profit.
A nonprofit corporation is the best way to do that.
Now you know, all the steps to form a nonprofit in Alaska
For a more detailed guide,
visit our site at startupsavant.com.
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If you have questions or encounter
any roadblocks, leave a comment below.
Good luck in starting your nonprofit.