How to Start a Charity Organization

Whether your issue is children or pets, the environment or religion, forming a charitable organization to raise awareness will likely be the hardest but most rewarding undertaking of your life. Charities are tenacious entities operating on lots of goodwill and very little money. Compensating for the lack of funds is the heart and soul of charitable groups: Committed staff members and volunteers driven by a desire to change the world for the better. While there are many nonprofits currently operating, there will always room for one more, so don't let the fear of overcrowding stop you. This guide will help you decide whether you are ready to launch a charity and how to do it as economically as possible.

Things You'll Need

• 501(c)3 IRS designation
• Federal incorporation papers
• State incorporation papers
• Board of Directors
• Volunteers

Instructions

1. Decide whether your cause is universal enough to warrant your energy, time and devotion. If you've been involved with a charity in the past and believe a different type of nonprofit would be better at carrying forward the issue's mission and goals, understand that trying to compete with an already-formed nonprofit means you will also be fighting for the same dollars and volunteers.

2. File for a government-sanctioned charitable designation. The Internal Revenue Service allows nonprofits to be established under its Section 501(c)3 tax code. Review the entire code to make certain your organization fits within one of the statute's subcategories.

3. Incorporate your charity. Hire an attorney to do this job. But if circumstances make this impossible, you can do a reasonable job of crafting your own articles of incorporation by using software available from legal websites. You will find one listed at the end of this article for your consideration. You may also wish to contact the IRS with questions pertaining to your charitable designation or incorporation at 1-800-829-4933.

4. Write a mission statement. If you are not familiar with this type of document, peruse charitable and corporate websites to locate examples. This succinct statement must cover reasons for the charity's formation and existence. Be creative about crafting your mission statement, and don't plagiarize the work of others, no matter how perfectly their verbiage may reflect your charitable mission.

5. Receive state operation approvals. Federal incorporation documentation won't do the job alone. You must also visit your state government's website to obtain application forms required to establish you as a charitable entity under the auspices of your Secretary of State.

6. Ensure the smooth operation of your new charitable organization by drafting bylaws to establish the group's rules and regulations. There are many books on how to write bylaws, and you may be able to locate good examples on the Internet. Don't skip this step, as you will be asked to provide copies of your bylaws for a wide variety of start-up filings.

7. Use your Federal Tax ID number to jump-start your agency as soon as you receive it. You must provide this number (and, less often, your state tax ID number) for a variety of activities including opening bank accounts, establishing credit, signing leases and signing contracts. Be aware of the fact that you may also be asked to provide your mission statement, bylaws, articles of incorporation and other documentation to prove you have completed all steps required to become a nonprofit.

8. Choose a board of directors to govern your agency. As a rule, boards help run nonprofits as advisers, mentors, fundraising sources and more. While every charity's executive director handles day-to-day operations, the position reports to the board of directors. This alliance keeps the agency's checks and balances in line with the charity's mission statement. Well-known board members add prestige and open doors, so don't be shy about reaching out to community or industry movers and shakers.

9. Recruit volunteers. Get the word out to people invested in your cause, and always keep volunteer recruitment on a front burner. Use the media to apprise your community of your charity's activities and volunteer recruitment efforts. Appearing on TV and radio or being interviewed by newspaper reporters goes a long way to getting your charity's name on the lips of potential donors.

10. Launch your fundraising efforts with a healthy balance of grant proposals, special events and awareness campaigns. Stay focused on your goals. Be aware of the fact that many nonprofits fall apart early because they become too ambitious too soon. In some cases, charitable groups failing to stay focused and on point can suffer the same consequences, so be vigilant about such pitfalls as you set out to change the world one person at a time.

Resources

• Software to help you form a nonprofit corporation