How to Start a Nonprofit in PA: Everything You Need to Know
You may want to know how to start a nonprofit in PA. Dong so requires a few steps. 3 min read
How to Start a Nonprofit in PA
You may want to know how to start a nonprofit in PA. Doing so requires a few steps. The first of which is to research the ones that are currently in existence. As of 2009, there were over 68,000 businesses and organizations categorized as nonprofits in the state of Pennsylvania. This is according to the National Center for Charitable Statistics.
Research Existing Nonprofits to Confirm a New Organization is Necessary
Before you begin your nonprofit, you'll want to see if there are any areas within your own community that have needs that are not being met by these established organizations. If one of these needs is in line with your specific cause, then establishing your nonprofit is a good idea.
If you notice that a business or organization exists that serves the same cause as you desire for your own nonprofit, then think about working with the business and pooling resources. This can help with serving your community better. You can also think about something called fiscal sponsorship. You will receive some tax benefits due to deductions, and you will likely be able to handle administrative documents.
Choose a Name for Your Pennsylvania Nonprofit Corporation
Research conducted in the presence of nonprofits in your community should lead you to examine that names of the organizations and how your own can be distinguishable from the others. You can look online to investigate the names of you can speak with the Department of State to see if the name you desire is available.
When you begin the nonprofit, you need to start with a mission statement. This describes the reason that the organization exists. The purpose of the entity can be established by meeting with clients and constituents and also with other people who are interested in the services you provide.
When developing your purpose or reason for existing, you will need to pick from a variety of different categories that are outlined by the IRS. The governmental code can help you to determine which type of nonprofit you can and will form. While there are more than 25 categories, some of the most commonly used categories are:
- 501(c)(1) – Corporations Organized under Act of Congress, including Federal Credit Unions
- 501(c)(3) – Religious, Literary, Charitable, Educational, Scientific, Testing for Public Safety, to Promote National or International Amateur Sports Competition, or Prevention of Cruelty to Children or Animals Organizations
- 501(c)(4) – Civic Leagues, Local Associations of Employees, and Social Welfare Organizations
- 501(c)(6) – Business Leagues, Chambers of Commerce, Real Estate Boards, etc.
- 501(c)(8) – Fraternal Beneficiary Societies and Associations
Recruit Incorporators and Initial Directors
The incorporator of the nonprofit is the individual who signs the Articles of Incorporation when the organization is developing. The board of directors of the entity must be identified and assigned, and these individuals are the ones who help you to turn your ideas into reality. The board can assist with the creation of goals as well as meeting those goals and identifying fundraising objectives.
According to the law in the state of Pennsylvania, each nonprofit entity will need a President, Treasurer, and a Secretary. However, one person can hold all of these positions.
The director for the organization must be an adult who is over the age of 18. He or she must also be a resident of the state of Pennsylvania. However, the bylaws can state that the director can be someone outside the state, but this is not often the case.
Appoint a Registered Agent
Nonprofit organizations will need something called a registered agent who is legally assigned to the entity to receive all legal paperwork for the organization. This person must reside in the state of Pennsylvania and must keep normal business hours so that individuals can get in touch with them at all times.
Write Your Nonprofit Bylaws
Organizations that are set up as nonprofits will have bylaws that explain the general day-to-day operations of the entity. These bylaws need to be drawn up or drafted carefully with the needs of the nonprofit in mind. Due to the critical nature of the documentation, it is often wise to hire a legal professional to assist with the bylaw drafting. Lawyers who understand nonprofit law are best since they will know how the different relationships should be set up and retained in the best interest of the nonprofit.
The bylaws also establish internal rules that should be followed by all members of the organization.
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