How to Become a Non Profit Organization in Ohio

Ohio nonprofits offer valuable community services such as environmental protection.

Ohio nonprofits have three options when forming. They can become a trust, an unincorporated entity, or an incorporated entity. Incorporation in Ohio is recommended if the nonprofit plans on acquiring assets such as a building or a vehicle and allows for federal tax exemption. Almost 4,000 organizations incorporated with the state of Ohio in 2007 alone, according to the office of the Secretary of State. Tax exemption offers incentives for Ohio residents to donate---the donor can write the gift off on personal taxes. Tax exempt nonprofits are also exempt from their own income tax as all profits are returned to the organization instead of being parceled out to shareholders.

Instructions

Unincorporated Organizations

1. File a Fictitious Name registration with the Secretary of State to notify Ohio of your organization. Filing this name does not prevent another organization from using it. To reserve this name completely you need to file it as a Trade Name. Both of these forms can be found on the website of the Secretary of State under Business Filings, Form 53A, and have a $50 fee.

2. 

   Unincorporated Ohio nonprofits have their own constutions.

   Create a Constitution that states your purpose and ultimate goals. This is similar to the mission of your organization and will be important to keep your nonprofit on track and active.

3. Draft bylaws that set out the rules and regulations of the maintenance and operation of your organization. These bylaws define procedures and how meetings and business are conducted within your Ohio organization. Bylaws are recommended for all entities regardless of incorporation.

4. Submit form 553 "Report of Operation of Business Trust," if you are a trust. This form has a $125 fee and can be expedited, and asks for information regarding address, registered agent and proposed business in Ohio. This must be certified by a notary and included with an Exhibit to Report of Operation. These documents notify the state of the trust's existence and authorized it to do business as a nonprofit.

Ohio Incorporation

1. Review the Internal Revenue Code section 501(c)(3) and recommended Articles of Incorporation if you plan on incorporating in Ohio and requesting federal tax exemption. The IRS website has listed the information necessary on your Articles of Incorporation, which include business address, directors, registered agent information, purpose clause and a plan for dissolution. It is important to include these in your Ohio registration to streamline the federal process later.

2. Complete the state designated form for the Initial Articles of Incorporation, Form 532, found on the Ohio Secretary of State's website under "Business Filings." There is a fee of $125 and the form can be expedited for another $100. The fees must be paid by check and mailed to the address posted on the form which varies according to expediting.

3. 

   Registered Agents can be a perso or business with an Ohio address.

   Assign a registered, or statutory, agent to your organization. This form is included in Form 532 and must be signed by the same directors that signed the Articles of Incorporation. A statutory agent is a representative who receives mail for the organization and must have an address in the state.

4. File a request for an Employer Identification Number, or EIN, by completing form SS-4 found online. The Internal Revenue Service website has an online application which you can complete or you can mail in the form. Print out the confirmation page if you file online as this has your EIN and allows you to complete federal registration immediately.

Federal Filing

1. Fill out form 1023-found on the IRS website to complete federal filing. This is the one form for all nonprofits to request exemption, so there are many questions that you do not need to answer. It will, however, ask about the business of your nonprofit and what you are hoping to accomplish in Ohio.

2. 

   Tax exemption must be formally requested through correspondence.

   Complete Form 8718 as well to formally request tax exemption. This is also found on the IRS website and must be included with Form 1032.

3. Attach a copy of your certified Articles of Incorporation, proposed budgets for the next three years and other financial information to Form 1032. These documents prove you are a registered Ohio nonprofit corporation and have thought through your future as a nonprofit.

4. Mail originals of the documents to:

   Internal Revenue Service

   P.O. Box 12192

   Covington, KY 41012-0192

   But make sure to keep copies for yourself.

Tips & Warnings

• Make copies of all documents for your files.

• Have someone look over documents to ensure everything is signed and that the facts are accurate.

• Be prepared to wait a few months for full tax exemption.

References

• Ohio Secretary of State: Nonprofit Organization Common Questions
• Internal Revenue Service: Tax Information for Businesses
• Internal Revenue Service: Charities and Other Non-profits
• Ohio Secretary of State: Nonprofit Organizations
• Internal Revenue: Tax Exempt Status for Your Organization

Resources

• Guide to Nonprofits in Ohio
• Internal Revenue Service
• Government of Ohio: Becoming a Tax Exempt Nonprofit
• Stay Exempt: IRS Tax Basics for Exempt Organizations
• Ohio Association of Nonprofit Organizations