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Welcome to our Virginia nonprofit resource guide! This free guide will help you understand how to start your nonprofit in Virginia and become 501(c)(3) tax exempt. You will find step-by-step instructions and get answers to common questions like "what does it cost?" and "how many board members do I need?".
If you're starting out with little or no funds, gaining professional assistance is rarely an option. In that case, you may want to commit to researching the process and filing government applications on your own. This route is not for the faint of heart but is certainly achievable if you work diligently. The following step-by-step guide should help you as you undertake this process.
As you begin, take a moment to consider if you should start a new non-profit organization. According to the National Center for Charitable Statistics, there were over 41,000 nonprofit organizations in Virginia in 2009. To decide if a new nonprofit is necessary...
This guide focuses on starting a nonprofit corporation, the traditional nonprofit legal structure. This legal structure has a few key benefits. First and foremost, the nonprofit corporation limits the liability of the organization's officers and directors. Second, the nonprofit corporation is familiar to donors and grant makers. Lastly, nonprofit corporations meet a wide range of IRS eligibility requirements, in particular those relating to the 501(c)(3) application.
The legal name of your nonprofit corporation may not conflict with any other registered name. Check availability of your desired name by conducting a name search.
Identify the nonprofit’s Virginia registered agent. A registered agent is a legal appointee who is responsible for receiving legal notices for your nonprofit. Your registered agent must be physically located in Virginia and maintain an office that is open during regular business hours.
We provide a convenient service to act as your Virginia registered agent. As part of that service, our local office in Virginia Beach, VA receives your legal documents and sends you notifications. You view your documents in your secure online account. Registered agent is included in our nonprofit formation service or you can sign up for this service separately.
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Below is an overview of the paperwork, cost, and time to start an Virginia nonprofit.
File articles of incorporation to create your non-profit corporation.
|Agency:||Virginia State Corporation Commission|
Mail or online at SCC eFile
$50 charter fee + $25 filing fee = $75 total
~7 business days by mail. ~3-7 business day online. Expedited options available for a fee.
Submit the original signed articles.
The IRS requires specific language in the articles of incorporation to qualify for 501(c)(3) federal tax exemption. These provisions are not always included in state articles of incorporation templates. Refer to IRS Pub 557 for guidance and sample language.
Your filed articles of incorporation are the first document for your nonprofit corporate records. Your
corporation will generate many other official records such as bylaws, meeting minutes, and your
Office supplies intended for a nonprofit corporation will help you stay organized and save time. Optionally, get a nonprofit records kit.
Draft bylaws which is the governing document for the nonprofit. You will review and ratify them at your first board of directors meeting.
The Board should create and adopt a conflict of interest policy. This document is submitted to the IRS at the time they apply for 501(c)(3) tax exemption.
Hold the first meeting of the board of directors. At this meeting, the nonprofit should approve the bylaws, elect additional directors, appoint officers, and approve initial resolutions such as opening a company bank account. Keep minutes of this meeting.
Your nonprofit must obtain an EIN regardless of whether it will hire employees.
|Agency:||Internal Revenue Service (IRS)|
Mail, phone, fax, or online
Immediately online or by phone. 4 business days by fax. 4-5 weeks by mail.
The IRS website is only available during certain hours. Print your EIN before closing your session.
Virginia offers a consolidated state tax registration application for new businesses.
Applying for 501(c) tax exemption is often the most complex and time-consuming steps in setting up a nonprofit. It is also one of the most important, as obtaining a tax exemption is what is enables an organization to successfully raise funds, apply for grants, be exempt from IRS income tax, and enjoy a variety of other benefits exclusively available to nonprofits.
501(c) is the chapter of the Internal Revenue Code that regulates nonprofit organizations. Most nonprofits are 501(c)(3)s, including charities and foundations. There are a few forms used to apply for federal tax exemption. 501(c)(3) nonprofits apply using Form 1023 or Form 1023-EZ. Not all organizations however are eligible to file the streamlined Form 1023-EZ. Other types of nonprofits, including 501(c)(4)s and 501(c)(6)s, apply using Form 1024.
Seeking the help of a professional with this step is common. Choosing the right form to file is just one consideration. A great deal of expertise, time, and preparation goes into creating a successful application. The IRS estimates over 100 hours are spent on researching and preparing the application. If you're looking for professional assistance, check out our formation services to help you with your 501(c) application and the rest of the process. Our nonprofit specialists will help you from start to finish.
|Agency:||Internal Revenue Service (IRS)|
$275, $400, or $850, depending on form and annual gross receipts
1023-EZ average: <1 month. 1023 average: 3-6 months.
The IRS will return a Determination Letter which officially recognized your exemption.
Upon obtaining your IRS Determination Letter, your organization is automatically exempt from Virginia corporation income tax. No application or notification is necessary.
Nonprofit organizations exempt from federal income taxation under Sections 501(c) (3) or 501(c)(4) of the Internal Revenue Code qualify for exemption from paying sales and use tax on purchases.
Before soliciting donations or hiring professionals solicitors, you must register in each state where you will raise funds.
To file in Virginia:
|Agency:||Virginia Office of Charitable and Regulatory Programs (OCRP)|
The most common exemptions are:
Read the full list of exemption criteria carefully, available at VAC § 57-60. File Form 100: Virginia Exemption Application for a Charitable or Civic Organization.
$100 initial registration fee + $30-325, depending on gross contributions ($10 if exempt)
Every charitable organization, except as otherwise provided for in the VSOC, which intends to solicit contributions within the Commonwealth, or have funds solicited on its behalf, is required to file an initial registration statement with OCRP, prior to any solicitation. You must file a registration application or exemption prior to fundraising.
Virginia Code Annotated §57-48 thorugh 57-61.1; Virginia Administrative Code, Title 2, §5-610-10 through 5-610-40. Virginia Solicitation of Contributions Law
Yes, Virginia requires a disclosure statement when communicating with donors. The disclosure statement must be printed on written solicitation, confirmation, receipt, and/or reminder of contribution materials.
Virginia follows the Charleston Principles regarding when your nonprofit needs to register due to online fundraising.
To fundraise nationally or online, please see our Fundraising Compliance Guide. Our services manage your initial, renewal, and exemption filings in every state.
To run your business legally, you must obtain applicable licenses and permits. The easiest way to navigate the wide range of federal, state, and local requirements is to search by your business type and locality using the Small Business Administration Business License & Permit look-up tool.
Once you have registered your nonprofit per the steps listed above, you will need to maintain compliance with all of the government agencies. Staying current with the IRS and state requirements is an ongoing responsibility. Continue reading our Virginia nonprofit compliance guide to learn more!
Download the case study of how our client, Reform It Now, obtained 501(c)(3) tax exemption in only two weeks using the new IRS Form 1023-EZ!
Filing fees depend on your individual situation. We do our best to calculate your filing fees upfront and collect those fees today so we can get started. Your specialist will determine your exact filing fees and invoice additional fees if required.
Government fees paid separately may incur a 3% convenience charge.