Start Your Washington Nonprofit

How to Start Your Washington Nonprofit Guide

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How to Start a Nonprofit in Washington


Welcome to our Washington nonprofit resource guide! This free guide will help you understand how to start your nonprofit in Washington 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.





1 Confirm a New Nonprofit is Necessary

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 36,000 nonprofit organizations in Washington in 2009. To decide if a new nonprofit is necessary...

  • Research if an organization already exists in your area that serves your cause. By working together you avoid diluting the effect of fundraising dollars and volunteer hours available in your geography.
  • Consider fiscal sponsorship, in which an umbrella 501(c) organization incubates your charitable nonprofit. Fiscal sponsors permit your cause to receive tax-deductible donations and often handle administrative paperwork.
2 Understand the Benefits of Incorporating

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.

3 Check Name Availability

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.

Name Search:
Washington Secretary of State database search
Name Reservation:
Optional
4 Recruit Incorporators and/or Initial Directors
  • Identify the incorporators. These individuals will execute the articles of incorporation and submit them to the state. Washington requires a minimum of one incorporator.
  • Recruit initial directors for your nonprofit board of directors. Washington requires a minimum of one initial director.
  • Nonprofits often begin working with us before they incorporate and select a board. We help you understand state and IRS requirements as you select your board members.
5 Appoint a Registered Agent

Identify the nonprofit’s Washington 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 Washington and maintain an office that is open during regular business hours.

We provide a convenient service to act as your Washington registered agent. As part of that service, our local office in Spokane, WA 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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Fast Facts

Below is an overview of the paperwork, cost, and time to start an Washington nonprofit.


Paperwork
  • Washington Nonprofit Corporation - Articles of Incorporation
  • Bylaws
  • IRS Form SS-4: Obtain an EIN
  • IRS Form 1023: 501(c) Tax Exempt Application
  • IRS Determination Letter
  • Form BLS-700-028: Washington Business License Application, if applicable
  • URS Charitable Registration, if applicable
  • Washington Charitable Organization Registration

Cost
  • Incorporation: $30 by mail. $80 expedited by mail. $50 online.
  • 501(c): $400 or $850 IRS fee
  • Washington Business License Application: $19, if applicable
  • Washington Charitable Organization Registration: $60 ($0 if exempt)

Time
  • Incorporation: ~2 months by mail. ~2-3 business days expedited by mail or online.
  • 501(c): 2 weeks to 3 months
6 File Washington Nonprofit Articles of Incorporation

File articles of incorporation to create your non-profit corporation.

Agency:Washington Secretary of State - Corporations Division
Form:

Washington Nonprofit Corporation - Articles of Incorporation

Instructions:

Washington Nonprofit Handbook

Filing Method:

Mail or online

State Fee:

$30 by mail. $80 expedited by mail. $50 online.

Turnaround:

~2 months by mail. ~2-3 business days expedited by mail or online.

Law:

Washington Nonprofit Corporation Act

Notes:
  • The Secretary of State will issue your Unified Business Identifier (UBI) which is your state id across state departments.
  • Nonprofit professional service corporations are an exception to the above instruction - they should be formed under RCW § 18.100.
Adding 501(c) provisions into your 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.

An initial report is not required for nonprofit corporations (it is for profit corporations).

7 Establish Organization Records

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 EIN.

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.

8 Hold First Meeting of the Directors

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.

9 Get a Federal Employer Identification Number (EIN)

Your nonprofit must obtain an EIN regardless of whether it will hire employees.

Agency:Internal Revenue Service (IRS)
Form:

IRS Form SS-4

Guidance:

IRS Pub 1635: Understanding Your EIN

Filing Method:

Mail, phone, fax, or online

IRS Fee:

$0

Turnaround:

Immediately online or by phone. 4 business days by fax. 4-5 weeks by mail.

Notes:

The IRS website is only available during certain hours. Print your EIN before closing your session.

10 Get Washington State Tax Identification Numbers/Accounts

The Unified Business Identifier (UBI) issued to your nonprofit by the Secretary of State is also your organization's id with the Department of Revenue.

You must register with the Department of Revenue if you meet any of the following conditions:

  • Your business is required to collect sales tax.
  • Your gross income is $12,000 per year or more.
  • Your business is required to pay taxes or fees to the Department of Revenue.
  • You are a buyer or processor of specialty wood products.
Submit to:
Washington Department of Revenue
http://dor.wa.gov/
Guidance:
Washington Department of Revenue - Nonprofit Organizations Guide
Form:
Form BLS-700-028: Washington Business License Application
Filing Method:
Mail or online
Fee:
$19
Turnaround:
~2 business days online. ~21 business days by mail.
Harbor's responsiveness and realistic understanding gave our organization a great start.
JohnThe Alumni Society of San Sebastian
Harbor helped me understand what's needed and why, and they pointed out the details that I didn't bother to pay attention to! They took care of the whole thing.
MarilynSynergize!
11 Apply for 501(c)

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)
Form:

IRS Form 1023IRS Form 1023-EZ, or IRS Form 1024

Instructions:

IRS Instructions for Form 1023IRS Instructions for Form 1023-EZ, or IRS Instructions for Form 1024.  Also see guidance IRS Pub 557: Tax-Exempt Status for Your Organization.

Filing method:

Mail

IRS Fee:

$400 or $850

Turnaround:

1023-EZ average: <1 month. 1023 average: 3-6 months.

The IRS will return a Determination Letter which officially recognized your exemption.

12 Apply for Washington Tax Exemption(s)

In Washington, nonprofit organizations are generally taxed like any other business. They must pay business and occupation (B&O) tax on gross revenues generated from regular business activities they conduct. They must pay sales tax on all goods and retail services they purchase as consumers, such as supplies, lodging, equipment, and construction services. In addition, nonprofit organizations must collect and remit retail sales tax on their sales of goods and retail services.

Limited B&O and sales tax exemptions are provided for nonprofit fundraising activities, donations, and for certain types of organizations.

Guidance:
Washington Department of Revenue - Nonprofit Organizations Guide
More information:
Washington Department of Revenue
http://dor.wa.gov/
13 Register for Charitable Solicitation / Fundraising

Before soliciting donations or hiring professionals solicitors, you must register in each state where you will raise funds.

To file in Washington:

Agency:Washington Secretary of State - Charities Program
Exemptions:

Certain organizations are exempt from registration; the list of exemptions was recently amended and is available at CR-103: revised WAC 434-120-100. Also see Charitable Organization Exemption Flow Chart.

Exempt organizations are encouraged to submit Optional Registration. This may be filed online. This allows the state to respond to customer inquiries about your organization.

Form:

Charitable Organization Registration / Renewal (Including the WA State Combined Fund Drive)

Instructions:

Washington Charitable Organization Registration Instructions and Suggested Guidelines to Complete the Solicitations Report

Filing method:

Mail

State Fee:

$60 + optional $50 expedite fee for 2-3 business day processing. ($0 if exempt)

Law:

Washington Revised Code Annotated §19.09.020 and following; Washington Administrative Code §434-120-100 through 434-120-175

Notes:
  • The URS is no longer accepted as of September 12, 2014.
  • Note the list of attachments that first-time registrants must attach to the application. This includes disclosing contracts with professional fundraisers.
Disclosures:

Yes, Washington requires a disclosure statement when communicating with donors.

Online fundraising:

Washington follows the Charleston Principles regarding when your nonprofit needs to register due to online fundraising.

Accepts URS:No

To fundraise nationally or online, please see our Fundraising Compliance Guide. Our services manage your initial, renewal, and exemption filings in every state.

14 Obtain Business Licenses & Permits

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.

* Ongoing Filings to Maintain Your Nonprofit

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 Washington nonprofit compliance guide to learn more!

Tax-Exempt in 2 Weeks!

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!

From filing the 1023EZ on August 1st to receipt of the determination letter on August 14th is, in my humble opinion, simply breathtaking and I dare say, ONLY Harbor Compliance could have achieved that.
Dr. Bob A.Reform It Now, Inc.

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  • Save 100+ hours preparing government forms. Your specialist customizes each of your applications for you.
  • Start fundraising with confidence! Gain access to grants and donations exclusive to 501(c)(3) nonprofits.
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This page was last fact-checked March 29, 2016.