Starting a nonprofit organization in Missouri involves more than a good idea. There are thousands of nonprofits out there each operating in a slightly different way. Before deciding to create a nonprofit organization, do the research. Discover if your organization needs to exist or if it is too similar to other organizations operating nearby. Knowing these answers will help when establishing your organization's mission and set it on the right path for a successful launch.
Nonprofits provide many important services in Missouri communities. Starting a nonprofit is exciting, challenging and can be ultimately fulfilling for all involved.
Hire an attorney, or include one on your board, if you are not already familiar with the process of creating a nonprofit organization. For example, according to Hurwit & Associates, a specialized firm helping those in philanthropy and the non-profit sector, there are a minimum of four key elements essential in creating a nonprofit in every state.
Build your board of directors and then draft bylaws which set forth your organization's structure. Bylaws are the written rules of conduct for nonprofit organizations and include its mission statement, provision for meetings, and elections and term limits of board of directors and officers. Bylaws also address filling vacancies, the manner in which future directors are selected, types and duties of officers, notices, committees, assessments and other routine conduct.
Bylaws are, in effect, a contract among members, and must be formally adopted and/or amended by the board.
Write your Articles of Incorporation and file as a nonprofit in Missouri. This step is relatively simple as most of the information in the Articles of Incorporation will already be a part of its bylaws and the nonprofit's attorney can easily do this filing. Bylaws should not be confused with the Articles of incorporation which only state the basic outline of the organization.
Apply to the Internal Revenue Services to obtain your federal tax exempt status. You can expect that this will be the most challenging and time consuming aspect of your legal paperwork and require the most legal advice. Obtaining a nonprofit 501(c)3 designation is essential if you are going to be raising money for your organization. The IRS usually asks for two pieces of information: a detailed description of the proposed activities of the organization and an estimated budget for its first three years. Don't be lulled by the simplicity of these questions. The IRS adheres to vigorous standards when granting tax-exempt status to a nonprofit.
Complete additional documents relating to Missouri's compliance, annual reporting requirements (if any), and stay current on new IRS compliance policies while practicing sound corporate record keeping. This record keeping would include a board meeting minute book showing any changes voted by the board which would affect the original bylaws, copies of insurance, other risk management documents and, of course, contracts.
Documents that include issues of compensation, conflict of interest or document retention are all policies that you will want to implement in order to continue to meet the requirements of the Internal Revenue Service and operate in a best practices manner.