Starting a business with a cause offers much satisfaction as you work to make lives better for others. To launch a nonprofit corporation, it requires taking many of the same steps a for-profit corporation or LLC does, but there are differences, too. Nonprofits must comply with some requirements that don’t affect other businesses.
So, where do you begin?
1. Understand what it means to be a nonprofit.
A nonprofit may be created a nonprofit for charitable, educational or certain other purposes—as long as they don’t directly benefit the owner. Nonprofits (if approved by the federal government) operate tax-free, and they can accept donations and apply for grants.
While a nonprofit business can make profits, surpluses must be used toward fulfilling the organization’s objectives—such as buying computer software to run the business more efficiently or investing in resources that deliver value to those that it serves. Continue reading
There are many steps between the initial idea stage and an operating 501 (c) (3) organization and the process will usually span a period of a year or more.
After you come up with an idea for a service or a program that can best be developed on a not-for-profit basis, it is critical to find other individuals who share your vision for this idea. These individuals must be willing to share the work involved in getting your idea off the ground and serve as your starting board of directors.
It is also important that your board offer financial support, as the level of board support is a question that other funding sources will often ask. It is helpful if board members with specific skills can be recruited; e.g. an accountant and/or a lawyer as well as people experienced in the field of service you hope to provide. Continue reading
Whether you already own your own business, or you’re still working for someone else, starting a nonprofit organization may be on your radar for several reasons:
- You’ve always wanted to make a difference in your community.
- Your current business is doing well, and you want to give back.
- There is a cause close to your heart, and you know you can help.
According to the National Center for Charitable Statistics, there are over 1.5 million nonprofit organizations in the U.S., and with corporate social responsibility all the rage today, that number is growing by leaps and bounds. A recent Nielsen survey showed respondents are willing to pay more for products and services from companies that have a positive social and environmental impact.
Starting a nonprofit doesn’t necessarily mean you can quit your day job right away, but like any small business owner, you could eventually earn enough from your nonprofit to justify a full-time salary for you and your staff. Continue reading
This will help. It’s the WASHINGTON NONPROFIT HANDBOOK: How to Form and Maintain a Nonprofit Corporation in Washington State, published by the Washington Attorneys Assisting Community Organizations and the King County Bar Association Young Lawyers Division.
Click the image to download a PDF copy of the handbook.