If you’re looking to start a Washington nonprofit organization, you’re in the right place. This guide will help you file formation documents, get set up for taxes, and obtain authority to solicit donations.
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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...
The most common legal structure for a nonprofit is a nonprofit corporation. Less common options include a B-Corporation, nonprofit LLC, L3C, unincorporated nonprofit association, and a trust. If you are undecided, learn about legal structures for nonprofits.
Washington's equivalent to a B-Corporation is a Social Purpose Corporations (SPC), which the state legislature approved in June 2012.
The rest of this article assumes you are creating a nonprofit corporation.
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 Washington Registered Agent. This individual or company receives notice of lawsuit and other legal service for the corporation.
File articles of incorporation to create your non-profit corporation.
An initial report is not required for nonprofit corporations (it is for profit corporations).
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 company record book, seal, and document templates.
Draft bylaws (potentially using a template) which is the governing document for the nonprofit. You will review and ratify them at your first board of directors meeting.
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.
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:
Save money and build credibility by obtaining 501(c) federal income tax exemption. This is most difficult and costly step of setting up a nonprofit.
501(c) is the chapter of the Internal Revenue Code that defines nonprofit tax exemptions. Charitable, religious, and educational organizations seek exemption under 501(c)(3) and apply for recognition by filing Form 1023.
The IRS will return a Determination Letter which officially recognized your exemption.
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.
Before soliciting any funds or hiring solicitors, you must complete your charitable organization registration in each state where you will raise funds.
If you need to register in many states, review our guide “Charitable Solicitation Registration using the Unified Registration Statement (URS)”. 39 states accept the URS, including Washington. Simply append the Washington Addendum to URS (see instructions).
To file only in Washington:
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.
You must file federal and state tax returns. You must also file:
Please feel free to contact us with any questions or feedback about this guide on how to start a non-profit organization in Washington.
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