Starting a 501(c)(3) Nonprofit in New York is Easy
To start a 501(c)(3) tax-exempt nonprofit organization in New York, you must first start a nonprofit in New York according to the rules of the state and then apply for 501(c)(3) status with the IRS.
Learn more about 501(c)(3) eligibility in our What is a 501(c)(3) guide.
Step 1: Name Your New York Nonprofit
Choosing a name for your organization is the first and most important step in starting your nonprofit corporation. Be sure to choose a name that complies with New York naming requirements and is easily searchable by potential members and donors.
To learn more, read our How to Name a Nonprofit in New York guide.
1. Follow the naming guidelines:
- Include some kind of organizational designation, such as “Incorporated”, “Inc.”, “Ltd.”, or “Company”
- Not be deceptive in any way or indicate your organization was designed for any purpose other than what is stated in your Certificate of Incorporation
- Not include words or phrases that could lead the public to believe your organization is acting as an agent of the United States or the State of New York
- Not include any of these words or phrases:
- doctor or lawyer (unless you obtain special permission)
- union, labor, council, industrial organization (when pertaining to worker’s rights, unless you attach an approval from the state board of standards and appeals)
- blind or handicapped (unless you attach an approval from the state department of social services)
- exchange (unless you attach approval from the attorney general)
- school, education, elementary, secondary, kindergarten, prekindergarten, preschool, nursery school, museum, history, historical, historical society, arboretum, library, college, university, or other restricted terms (unless you attach approval from the state commissioner of education)
- In addition, your nonprofit’s name cannot use words or phrases that are considered obscene or ridiculing any person, group, belief, etc. or indicate that your group will engage in unlawful activity.
Access the New York State Senate's official guidelines for more information about naming a nonprofit in New York.
2. Is the name available in New York? Make sure the name you want isn't already taken by doing a business entity search on the NYS Division of Corporations website.
3. Is the URL available? We recommend that you check to see if your business name is available as a web domain. Even if you don't plan to make a business website today, you may want to buy the URL in order to prevent others from acquiring it.
Step 2: Choose a Registered Agent in New York
In New York, the Secretary of State acts as the statutory agent for service of process (registered agent) for all New York organizations by default.
In addition, you can choose to elect a registered agent for your New York organization. You will be given this option when you complete your business’s formation documents.
What is a Registered Agent? A registered agent is an individual or business entity responsible for receiving important legal documents on behalf of your business. Think of your registered agent as your business's point of contact with the state.
Who can be a Registered Agent? A registered agent must be a resident of New York or a corporation, such as a registered agent service, authorized to transact business in New York. You may elect an individual within the company including yourself.
Need help choosing a registered agent? Check out our complete guide on How to Choose a Registered Agent for your New York Nonprofit.
Step 3: Choose Your Organization Type
Before proceeding further, you must decide what kind of corporate structure your organization will have and obtain any approvals you might need. You will need to choose from the following options:
- Religious Corporation - there are distinct rules and regulations that are applicable to religious corporations operating in New York. Access further information about starting a religious organization in New York in the Consolidated Laws of New York.
- Nonreligious Corporation
- Consent or Approval Required - If your nonprofit’s purpose is related to any of the following in the graph below, you must obtain approval from the appropriate governing body. This approval must accompany your Certificate of Incorporation application.
|Organization's Purpose||NY Government Agency|
404(a) formation of a trade or business association
NY Attorney General
404(b) adult care facility, victims of domestic violence, care of dependent children, adoption, foster care, etc.
Children - Children and Family Services
Adults - Commissioner of Health
404(c) operation of a hospital or health service, or medical/dental indemnity plans
Commissioner of Health
404(d) operation of a university, school, college, museum, library, or historical society or any other purpose in which the organization might be chartered by the Board of Regents
|Commissioner of Education|
404(f) fire corporation
Authorities in your local city/village/town
404(g) prevention of animal cruelty
|American Society for the Prevention of Cruelty to Animals
Certified copy of an order by the justice of your local supreme court
404(i) raise funds for or benefit the armed forces
404(j) labor unions and similar organizations
Industrial Board of Appeals
404(k) promotion of banks, life insurance, or interests of member banks
Superintendent of Financial Services
404(l) insurance agents, brokers, underwriters or independent laboratories (and more)
Superintendent of Financial Services
404(m) includes the name of a political party
Chairman of your local county's political party of the same name
404(n) includes the words American Legion
American Legion Department of New York
404(o) (t) maintenance of a hospital or soliciting contributions for such a purpose
Public Health and Planning Council
404(p) medical corporation
|Commissioner of Health
Public Health and Planning Council
404(q) establishing or operating mental health facilities
Commissioner of Mental Health
404(r) health maintenance organization
Commissioner of Health
404(u) establishment or operation of a substance abuse program or soliciting donations on behalf of one of these programs
Commissioner of the Office of Alcoholism and Substance Abuse Services
404(v) establishment, operation, and maintenance of a nonprofit casualty and/or property insurance company
Superintendent of Financial Services
Read full descriptions of each of these categories in Section 404 of the New York State Senate’s requirements for nonprofit corporations
No Consent or Approval Required - if your nonprofit does not fall into one of these categories, you do not have to submit additional approval information with your Certificate of Incorporation application.
Step 4: Select your Directors & Officers
The directors of an organization come together to form a board of directors. This board of directors is responsible for overseeing the operations of the nonprofit.
The president, secretary, and other members of nonprofit who have individual responsibilities and authorities are known as officers.
The organization structure of your nonprofit in New York MUST include:
- At least 3 directors not related to each other
- A president
- A minimum of 1 vice president
- A secretary
- A treasurer
NOTE: The president and secretary positions cannot be held by the same person.
To learn more about electing a New York nonprofit board of directors, read our full guide.
Step 5: Adopt Bylaws & Conflict of Interest Policy
To be eligible to apply for 501(c)(3) status, your nonprofit is required to have the following two documents:
- Conflict of interest policy.
What are Bylaws? Bylaws are the rules outlining the operating procedures of the nonprofit.
What is a Conflict of Interest Policy? A Conflict of Interest Policy is the collection of rules put in place to ensure that any decisions made by the board of directors or the officers benefits the nonprofit and not individual members.
NOTE: The bylaws and conflict of interest policy must be adopted by the nonprofit during its first organizational meeting where the directors and officers are officially appointed.
Step 6: File the New York Certificate of Incorporation
To register your nonprofit, you will need to file the Certificate of Incorporation with the State of New York.
To ensure that your nonprofit is eligible to apply for 501(c)(3), in the Certificate of Incorporation you must explicitly state the following:
In order to qualify for 501(c)(3) status, the organization’s purpose must explicitly be limited to one or more of the following:
Charitable, Religious, Scientific, Educational, Literary, Fostering national/international amateur sports competition, Preventing cruelty to animals/children, Testing for public safety
You must explicitly state what the assets of the organization will be used for, and what will happen to the assets if the organization is dissolved.
To be eligible for 501(c)(3) status, the assets of your organization must only ever be used for purposes approved under section 501(c)(3).
Section 5 of this sample IRS document provides an example of these provisions required for 501(c)(3) eligibility.
File the Certificate of Incorporation
File Form DOS 1511 by Mail, by Fax, or In Person
State Filing Cost: $75
Department of State Division of Corporations
State Records and Uniform Commercial Code
One Commerce Plaza
99 Washington Ave.
Albany, NY 12231
Fax: (518) 474-1418
Note: Fax filings must include a Credit Card/Debit Card Authorization form.
Step 7: Get an EIN
What is an EIN? The Employer Identification Number (EIN), or Federal Tax Identification Number, is used to identify a business entity such as your nonprofit corporation. It is essentially a social security number for your organization.
Why do I need an EIN? An EIN is required for the following:
- To open a business bank account for the company
- For Federal and State tax purposes
- To hire employees for the company
How do I get an EIN? An EIN is obtained from the IRS (free of charge) by the business owner after forming the company. This can be done online or by mail. Check out our EIN Lookup guide for more information.
Step 8: Apply for 501(c)(3) Status
Before a nonprofit can apply for 501(c)(3) status it must,
- Elect at least 3 directors not related to each other
- File the Certificate of Incorporation with the required provisions (As covered in Step 6)
- Adopt the bylaws and conflict of interest policy
- Have an EIN number
Once these four conditions have been met your nonprofit can apply for 501(c)(3) tax-exempt status by filing Form-1023 online.
If your application is approved, the IRS will send you a determination letter stating that your organization is exempt from federal taxes under section 501(c)(3).
FAQ: Starting Your Nonprofit
When should an organization apply for federal tax exemption?
Form 1023 must be filed within 27 months from the end of the first month your organization was created.
How long will it take for the IRS to process Form 1023/1023-EZ?
Soon after sending your application you should receive an acknowledgment of receipt of your application.
If your application is simple and complete, IRS will send your determination letter within 180 days for Form 1023
If you have not heard from them by that time you can call (877) 829-5500 to inquire about your application.
Important Steps After Forming a Nonprofit
1. Opening a business bank account:
- Separates your personal assets from your company's assets, which is necessary for personal asset protection.
- Makes accounting and tax filing easier.
To open a bank account for your nonprofit corporation you will typically need the following:
- The EIN for the nonprofit
- A copy of the nonprofit’s bylaws
- A copy of the Certificate of Incorporation
Read our Best Small Business Banks review to find the right bank for your nonprofit’s needs.
2. Getting a business credit card:
- Helps you separate personal and business expenses.
- Builds your company's credit history, which can be useful to raise capital later on.
3. Hiring a business accountant:
- Prevents your business from overpaying on taxes while helping you avoid penalties, fines, and other costly tax errors
- Makes bookkeeping and payroll easier, leaving you with more time to focus on your growing business
- Helps effectively manage your business funding and discover areas of unforeseen loss or extra profit
For more business accounting tools, read our guide to the best business accounting software.
Business insurance helps you manage risks and focus on growing your business.
The most common types of business insurance are:
- General Liability Insurance: A broad insurance policy that protects your business from lawsuits. Most small businesses get general liability insurance.
- Professional Liability Insurance: A business insurance for professional service providers (consultants, accountants, etc.) that covers against claims of malpractice and other business errors.
- Workers' Compensation Insurance: A type of insurance that provides coverage for employees’ job-related illnesses, injuries, or deaths.
Build a Business Website
Creating a website is a big step in legitimizing your business. As a nonprofit, your website will be the primary way to share your organization’s mission and story to supporters. Your website should be a great resource for anyone interested in your nonprofit’s upcoming events, goals, and news to help advance your cause.
Some may fear that creating a business website is out of their reach because they don’t have any website-building experience. While this may have been a reasonable fear back in 2015, web technology has seen huge advancements in the past few years that makes the lives of small business owners much simpler.
Properly Sign Legal Documents
Improperly signing a document as yourself and not as a representative of the business can leave you open to personal liability.
When signing legal documents on behalf of your nonprofit, you could follow this formula to avoid problems:
- Formal name of your organization
- Your signature
- Your name
- Your position in the business as its authorized representative
See the image below for an example:
This ensures that you are signing on behalf of your nonprofit and not as yourself.
State of New York Quick Links
- IRS - Information for Charities & Nonprofits
- IRS - Required Provisions for Organizing Documents
- IRS - 990 Series for Tax-Exempt Organizations
- IRS - Applying for Tax-Exempt Status
- IRS - 501(c)(3) Compliance Guide
- Small Business Administration - License and Permits
- New York Department of State - Nonprofit Corporation Forms
- New York Department of State - Business Services
- NY Senate - Business Corporation Statutes
- New York Department of Taxation and Finance
- New York State Charities Division