Improving communities and changing lives
A nonprofit, or non-profit corporation, is a company or organization formed for purposes other than making a profit. Like standard for-profit corporations, nonprofits provide limited liability protection. The personal assets of directors and officers typically cannot be used to satisfy the debts or liabilities of the nonprofit.Order Your Nonprofit Corporation Package Today!
Advantages of a nonprofit corporation
Nonprofit corporations typically offer certain benefits:
- Limited liability protection. Directors and officers are typically not personally responsible for the nonprofit’s debts and liabilities.
- Tax-exempt status. Nonprofits can apply for both federal and state tax-exempt status.
- Access to grants. Some nonprofits are eligible to receive public and private grants, making it easier to get operating capital.
- Tax-deductible donations. With 501(c)(3) nonprofits, donations made by individuals to the nonprofit corporation are tax-deductible.
Forming a nonprofit corporation?
Non-profit corporations follow state laws that are very different from those of standard corporations — but the business formation process is very similar. To start a non-profit organization, non-profit Articles of Incorporation must be filed with the state and applicable state filing fees paid. In order for your non-profit corporation to become tax-exempt, Form 1023 must be filed with and approved by the IRS. Some states also require a state-level tax-exempt status filing.
Outside of providing limited liability protection, non-profit incorporation can lend additional credibility to your organization, as others may feel you are “more legitimate” because you have taken the steps to formalize your non-profit with the state.
Incorporating a nonprofit establishes the nonprofit with the state of incorporation, but does not provide tax-exempt status. In order to have federal tax-exempt status, Form 1023 must be filed with and approved by the IRS.
63 Parkhill Road, Nottingham, MD 21236
We are open:
Monday – Friday 9AM – 5PM