Starting a nonprofit in New York can be an incredibly rewarding experience — especially if you’re passionate about a cause in your community.
But just like starting a for-profit business, starting a nonprofit takes some thought and effort, as well as a bit of paperwork. In this blog, we’ll cover everything there is to know about starting a nonprofit in New York so you can begin making an impact in no time.
15 steps to create a nonprofit in NY
- Step 1: Research and plan
- Step 2: Name your organization
- Step 3: Choose a corporation structure
- Step 4: Recruit a leadership team
- Step 5: Appoint a registered agent
- Step 6: Obtain NY agency approval
- Step 7: File the Articles of Incorporation
- Step 8: Apply for an EIN
- Step 9: Create bylaws
- Step 10: Get New York state tax identification numbers/accounts
- Step 11: Apply for federal and state tax-exempt status
- Step 12: Register for charitable fundraising
- Step 13: Obtain other necessary permits and licenses
- Step 14: Start fundraising
- Step 15: Stay compliant
Step 1. Research and plan
When considering starting a nonprofit in New York from scratch, it can be hard to know where to begin. When deciding to take on the endeavor, it is important to get clear on a few fundamental things, including:
- Community needs: Consider what problems you want to address or what positive changes you want to make.
- The market: Research nonprofits in New York land that work in similar areas or address similar issues. Identify any gaps or needs that your nonprofit could address.
- Your goals: Clarify your nonprofit's specific goals and objectives. Determine what you hope to achieve in the short term and long term.
- Your mission statement: Write a clear and concise mission statement that articulates who you are, what you do, and who you serve.
- Feedback: Seek feedback from stakeholders, potential beneficiaries, and members of your community to ensure that your mission statement accurately reflects community needs.
Step 2. Name your organization
Once you’ve determined your organization’s core mission and goals, it’s time to name your nonprofit. Not only is this step in the process important for marketing and branding purposes, but it’s also a crucial part of the legal process of starting a nonprofit in New York.
When deciding on your organization’s name, be sure to choose a name that:
- Reflects your mission and goals
- Describes what you aim to do
- Is easy to spell and pronounce
- Offers room for future growth
Once you’ve determined a name, you’ll need to include 'corporation', 'incorporated', 'limited', or an abbreviation of one of such words in your name. Then, search for your name on New York’s Corporation and Business Entity Database to ensure that no other organization in the state has that name.
If you’ve searched your name and find that it’s unique, you can reserve it with NYS by filing a $10 Application for Reservation of Name.
Step 3. Choose a corporation structure
Next, you’ll need to decide on the structure of your organization. In New York, your organization can either be classified as religious or non-religious:
- Religious: A religious corporation is formed for religious purposes and is typically associated with a specific faith or religious denomination. Examples include churches, synagogues, mosques, temples, and other religious institutions.
- Non-Religious Nonprofit Corporation: A non-religious nonprofit corporation is formed for purposes other than religious activities, such as charitable, educational, scientific, literary, or social welfare purposes. Examples of non-religious nonprofit corporations include charitable organizations, educational institutions, foundations, social service agencies, and advocacy groups.
Step 4. Recruit a leadership team
Once you’ve determined your organization name and confirmed that it is not already in use, it’s time to create a leadership team.
Identifying an Incorporator and a Board of Directors is not only a strategic decision that can help make your nonprofit a success, but it’s a required one in New York.
- Incorporator: Nonprofits must recruit at least one Incorporator who will be responsible for signing the Articles of Incorporation.
- Directors: You must assemble a board of at least three directors, at least 18 years of age, who will help guide your nonprofit through strategic decision-making. You’ll also need a president, one or more vice presidents, a secretary, and a treasurer (two or more offices may be held by the same individual, except for the president and secretary).
When choosing your leadership team, be sure to select people who are trustworthy, dependable, and bring a skillset to the table. Whether they’re already a member of your organization or a trusted volunteer, they’ll help you make crucial decisions about your charity.
Step 5. Appoint a registered agent
Appointing a registered agent is a vital step when forming a nonprofit in New York. In essence, a registered agent acts as a reliable point of contact for legal matters. This designated individual receives important documents and official correspondence on behalf of your nonprofit, such as legal notices and tax forms.
The registered agent must be located in New York and available during regular business hours to receive legal correspondence and communication.
Step 6. Obtain NY Agency Approval
Next, you’ll need to gain approval for your organization type by reaching out to the appropriate agency in New York. When getting agency approval, you’ll need ot send along your Certification of Incorporation once it’s completed, too.
Below are the different types of corporations you can form and the agencies that correspond with them:
- 404(a): Formation of a trade or business association: Office of the Attorney General - Antitrust Bureau
- 404(b): Daycare, adoption, foster care and domestic violence, neglected or dependent children, programs for the elderly, and solicitation of funds for such purposes: Office of Children and Family Services
- 404(b): Establishment or operation of any aged care accommodation; adult care facility; enriched housing programs; residences for adults or the solicitation of contributions for any such purpose: Department of Health - Division of Legal Affairs
- 404(d): General educational purposes, including purposes for which a corporation might be chartered by the Board of Regents. ($10.00 fee paid by check or money order.): NYS Department of Education - Office of Counsel
- 404(o), (p), (t): Establishment or maintenance of medical corporations or health facilities (under Articles 44 or 28 of the Public Health Law), or solicitation of funds for such purposes: NYS Department of Health - Division of Legal Affairs
- 404(q): Establishment or operation of a facility requiring licensing by Division of Mental Health or solicitation of funds for such purpose: NYS Office of Mental Health - Bureau of Inspection and Certification
- 404(q): Establishment or operation of a facility requiring licensing by Office of Mental Retardation and Developmental Disabilities or soliciting funds for such a purpose: NYS Office for People with Developmental Disabilities - Office of Counsel
- 404(u), (v): Establishment or operation of a facility requiring licensing by Office of Alcoholism and Substance Abuse Services or soliciting funds for such purposes: Office of Alcoholism and Substance Abuse Services
Step 7. File the Articles of Incorporation
One of the most crucial steps in starting a nonprofit in New York is filing the Articles of Incorporation with the New York Department of State. This will officially establish your nonprofit as a legal entity in the state.
You can file the articles of incorporation by mail, fax, or in person. Typically, the filing fee costs $75 with an optional $25-150 expedited fee.
Step 8. Obtain an EIN
In New York, like in other states, nonprofits are required to obtain an EIN, or Employer Identification Number. An EIN is like your organization's social security number. It's used for tax purposes, including opening bank accounts, hiring employees, and applying for tax-exempt status.
To get an EIN, you can apply online using the IRS Form SS-4 on the IRS website or submit it by mail. The application process is free, and you'll receive your EIN shortly upon approval.
Step 9. Draft bylaws
Next, you’ll need to call a meeting with your board to draft bylaws that align with your mission and comply with New York nonprofit laws.
Bylaws are the rules and procedures that govern how your nonprofit operates. They outline the structure of your organization, the responsibilities of the board and officers, how meetings will be conducted, and how decisions will be made.
When creating your bylaws, be sure to:
- Use clear and concise language: Make the language easy to understand for all board members and stakeholders. Avoid jargon and overly complex language.
- Make them comprehensive: Your bylaws should cover all essential aspects of your organization's governance, including board structure, officer roles, meeting procedures, decision-making processes, and conflict resolution mechanisms.
- Alignment bylaws with mission and values: Ensure that the bylaws reflect and support the goals of the organization.
- Consider flexibility: Include provisions that allow for amendments to the bylaws as the organization evolves and grows.
- Outline board structure and responsibilities: Clearly define the board of directors, its qualifications, terms of office, and responsibilities.
- Determine meeting procedures: Detail the frequency, notice requirements, quorum, voting procedures, and more.
- Address finances: Establish guidelines for budgeting, accounting, and reporting requirements.
- Create a conflict of interest policy: Include a conflict of interest policy that requires board members and officers to disclose any conflicts of interest and abstain from voting on matters in which they have a personal or financial interest.
- Include dissolution procedures: Include provisions for the process of distributing assets and winding up affairs in accordance with state law and IRS regulations.
Step 10. Get New York State tax identification numbers/accounts
New York does not offer a consolidated state tax registration application, so you’ll need to register for individual tax accounts that apply, based on the Pub 20: New York State Tax Guide for New Businesses. Then, submit it to NYS Department of Taxation and Finance.
If your organization conducts activities in New York City, register for city taxes with the the City of New York Finance Commissioner.
Step 11. Apply for federal and state tax-exempt status
Next, you’ll need to apply for both federal and state tax exemption.
- Federal tax-exempt status: Fill out Form 1023, Application for Recognition of Exemption Under Section 501(c)(3) of the Internal Revenue Code. You’ll need to provide detailed information about your nonprofit's activities, finances, and governance.
- State: To receive state tax exemption, you’ll need to fill out Form CT-247: Application for Exemption from Corporation Franchise Taxes by a Not-for-Profit Organization. For sales tax exemption, you’ll need to file Form ST-119.2: Application for an Exempt Organization Certificate. And for property taxes, check out Property tax exemption forms listing.
Nonprofits in New York City may apply for property tax exemption with the New York City Department of Finance.
Step 12. Registered for charitable fundraising
If, like most nonprofits, you intend to solicit and accept charitable donations, you’ll need to register with the NYS Attorney General (Charities Bureau).
Your initial registration can be done online for $25.
Step 13. Obtain other necessary license
Once you’ve completed all the necessary steps for filing within New York State, it's important to review New York’s Business Express site to ensure there aren’t other business licenses you’ll need to run your nonprofit.
Step 14. Start fundraising
Once you’ve filed all of the appropriate forms and established the necessary regulatory foundation for your nonprofit, it’s time to start fundraising.
First, build a fundraising plan that outlines your goals, strategies, and tactics. Plus, be sure to consider how you’ll cultivate donor relationships. Then, Put your fundraising plan into action by launching campaigns, events, and appeals to solicit donations and support. Keep track of your fundraising efforts and evaluate their effectiveness over time.
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Step 15. Stay compliant
As a legal nonprofit in the state of New York, you’ll need to remain compliant with federal and state rules and regulations throughout the year. This includes:
- Maintaining records: Keep accurate and up-to-date records of your nonprofit's activities, finances, and governance. This includes meeting minutes, financial statements, tax filings, and other important documents.
- Filing annual reports: File annual reports with the IRS to maintain your nonprofit's legal and tax-exempt status.
- Staying informed: Stay informed about changes to New York state laws and regulations affecting nonprofit organizations. Attend training sessions, workshops, and webinars to learn about best practices and compliance requirements.
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Learn how this NY nonprofit raised $5MM dollars for free
New York City Foundation for Computer Science Education Inc., CSforALL—a NY-based nonprofit dedicated to making high-quality computer science an integral part of the educational experience of all K-12 students and teachers—has helped over 160 school districts. Motivated by the drive to launch children into career success, CSforALL offers several programs and initiatives designed to use tech for good.
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How to start a nonprofit in NY FAQs
How much does it cost to start a non-profit in NY?
The costs associated with starting a nonprofit in NY can vary, however, typical costs include:
- Incorporation fees: To establish a nonprofit in New York, you'll need to file a Certificate of Incorporation with the New York Department of State. The filing fee for this document is typically $75.
- Legal fees: Many organizations choose to seek legal assistance when incorporating a nonprofit to ensure compliance with state laws and IRS regulations. Legal fees can vary from several hundred to a few thousand dollars.
- IRS application fee: The application fee for Form 1023 is currently $600 for organizations with annual gross receipts of $50,000 or more, and $275 for organizations with annual gross receipts of less than $50,000. Form 1023-EZ has a lower fee of $275.
- Name reservation: Once you severe your nonprofit's name, you can reserve it for $10.
- NY Agency approval: Obtaining agency approval varies in cost depending on the kind of agency you start.
- Charitable fundraising registration: To register for charitable fundraising, you’ll need to pay a $25 fee.
How do I start a non-profit organization in NY?
- Step 1. Research and plan: Determine your mission, target audience, and ultimate goals.
- Step 2. Name your organization: Choose a unique and descriptive name for your organization that aligns with your mission and abides by NY state laws.
- Step 3. Choose a corporation structure: Determine if your organization is religious or non-religious in nature.
- Step 4. Recruit a leadership team: Appoint one incorporator and three directors.
- Step 5. Appoint a registered agent: Identify a trusted person who will receive legal documents on behalf of the nonprofit.
- Step 6. Obtain NY agency approval: Gain approval for your organization type by reaching out to the appropriate agency in New York.
- Step 7. File the Articles of Incorporation: File with the New York Department of State to officially establish the nonprofit.
- Step 8. Apply for an EIN: Apply for an Employer Identification Number (EIN) from the IRS for tax purposes and financial transactions.
- Step 9. Create bylaws: Draft and adopt rules outlining the internal governance and operational procedures of the organization.
- Step 10. Get New York State tax identification numbers/accounts: Register for individual tax accounts that apply.
- Step 11. Apply for tax-exempt status: Apply for federal and state tax-exempt status under section 501(c)(3) of the Internal Revenue Code and New York state law.
- Step 12. Register for charitable fundraising: Register with the New York Attorney General's Charities Bureau in order to solicit donations from the public.
- Step 13. Obtain other necessary permits and licenses: Apply for any additional permits and licenses required to operate legally in New York.
- Step 14. Start fundraising: Use a 100% free fundraising platform like Zeffy to start raising funds in minutes.
- Step 15. Stay compliant: Ensure ongoing compliance with all applicable federal, state, and local regulations to maintain nonprofit status.
How do I start a nonprofit organization by myself?
While starting a nonprofit organization by yourself is possible, it's often recommended to seek assistance from legal and financial professionals experienced in nonprofit law to ensure compliance with all applicable laws and regulations. Plus, per state New York laws, all nonprofits must have at least three directors.
How many board members are required for a nonprofit in New York?
In New York, nonprofit organizations are required to have a minimum of three directors. However, some organizations may choose to have more directors depending on their specific needs and circumstances. The board of directors should be diverse, representing a range of skills, expertise, and perspectives relevant to the organization's mission and goals.
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