Non-profit corporations have different legal requirements than regular corporations. In order to maintain non-profit status for your corporation, there are various rules that you must follow. If you do not abide by these requirements, you risk losing your non-profit corporation status. Therefore, it is essential that you get the legal counsel that you need in both forming and maintaining your non-profit status under California law.
First, there are some requirements that you must follow in order to establish a corporation in the state of California, whether it is non-profit or for-profit. You must choose a corporate name that is not the same as or substantially similar to an existing name that is on the records of the California Secretary of State. You can check by searching the business name database online on the Secretary of State’s website. Next, your corporation must have a written Articles of Incorporation, which identifies the corporation’s name, the purpose of the corporation, the name and address of the person who will receive service of process for lawsuits and other legal notices on behalf of the corporation, and any limitations on corporate powers. While a non-profit under California law may have only one director, most non-profit corporations have between three and 25 directors. Written bylaws will specify the general operating practices and the policies of the corporation, such as how directors are elected, how meetings are noticed and scheduled, and the duties and responsibilities of corporate officers.
As a non-profit corporation, there are some other start-up steps that you must take in order to comply with California law. You should obtain an employer identification number, which you can do online. Most non-profits must file an initial registration form with the California Attorney General’s Registry of Charitable Trusts, along with their articles of incorporation and by-laws. This form must be initially filed within 30 days of the corporation receiving assets, and typically must be filed annually. Within 90 days of incorporation, you also must file the Statement of Information form with the Secretary of State, which you later must file every two years.
Another essential and rather complicated component of establishing a non-profit corporation is to apply for federal tax exempt status with the Internal Revenue Service (IRS), or what is commonly referred to as Section 501(c)(3) status. You must complete a lengthy application, including a detailed description of any past, present, or future activities in which you intend to participate. Next, you submit the application to the IRS, along with a filing fee that is usually $850. The IRS may take three or four months or even longer to process your application.
When you are looking to create a non-profit corporation, there are a number of laws and requirements that you must follow. In this situation, Heit Law Group, P.C. is here to help. We care about you and your non-profit corporation, and, as a result, our California business law attorneys stand ready to represent your interests and give you the advice that you need. Contact your California business lawyer today and learn how we can advocate for your business in whatever legal matters arise.