If you’re trying to make a difference in your community but still want to experience the joys and independence of being a business owner, forming a non-profit can be a great choice. These organizations also offer distinct tax benefits but before you claim them, you need to be a recognized 501(c)(3) organization. Here’s how you can go about obtaining tax-exempt status in New York.

forming a non-profit organization in new york

Identify Your Directors

Your non-profit’s directors will oversee much of the development and growth of the organization. Before you can pursue non-profit status, you’ll need to know exactly who those directors will be. If you’re running things on your own, you’ll likely want to appoint yourself as the director. But if you’re running it with others, you’ll need to make sure each director you name is at least 18 years of age. Your New York non-profit formation attorney can advise you on what to look for in a director if you want help from someone else.

Find a Registered Agent

No matter what type of business you’re running or what causes your non-profit support, you’ll need to work with a registered agent in the state of New York. Registered agents are the state’s point of contact for your non-profit to oversee and receive all legal documents the state may send. You’ll likely want to choose an experienced New York business law attorney as your registered agent. They’ll be able to explain what each document means and help you make sure everything is filled out correctly.

File the Articles of Organization

Your non-profit’s articles of organization outline the core information about your non-profit. You’ll want to include the name of your organization, the reason you’re forming the non-profit, the county where you’ll be headquartered, the names and contact information of the non-profit’s directors, and other similar information. Again, your New York non-profit formation attorney can help you create these articles.

Create Your Bylaws

Your bylaws will provide clear directions about the rules you’ll follow and the procedures you’ll use to operate and grow. These are not required by the state, but they’re still a good practice to implement from the beginning. It gives your non-profit the background it needs to stay on track.

Get Your Business License

Like any organization and business, you’ll need to get a business license to operate in New York. You’ll likely need to apply for and obtain both local (county-specific) and state licenses before you can open your doors. Speak with your county clerk for more information.

Apply for Tax Exempt Status

As we mentioned earlier, non-profits are entitled to certain tax exemptions that normal for-profit businesses cannot claim. But to qualify for those exemptions,  you’ll need to file for tax-exempt status with the federal government and the state. 

Fill out the IRS Form 1023 to apply for federal 501(c)(3) status. You’ll need to provide details about your non-profit including the organization structure, the finances, key policies you’ll follow, and other similar information. The IRS will review this information and if everything meets their requirements, they’ll give you the 501(c)(3) status you need.

Once you have the federal tax-exempt status, you’ll need to file with the state. To do this, you’ll fill out Form CT-247 to be exempt from corporation franchise taxes and Form 25-119.2 to be exempt from state and local sales tax. 

Work With a New York Non-Profit Formation Attorney

If you’re trying to get your non-profit up and running quickly, one of the best things you can do is speak with a New York non-profit formation attorney. At Gold Law Firm, we have experience helping non-profits of all sizes get their organizations up and running in New York. Contact us to schedule a free consultation.