How To Start a Nonprofit in Georgia

If you're going to run a nonprofit, you'll need to show that your charitable organization meets a need in your community. It's essential to demonstrate the need for your services when you seek grants and donations, so research the needs of the community you'd like to serve.

Next, research the nonprofits already in the area. Consider if the nonprofits adequately meet the community's needs or if there is a gap you can fill. Also, consider whether you can reach your goals by volunteering or partnering with an already existing nonprofit.

If, after conducting market research, you decide you'd like to move forward with your nonprofit, start thinking about your organization's purpose and vision. Once you understand these, you can draft a mission statement incorporating your vision, purpose, and goals.

Choosing a name for your nonprofit is a crucial first step. Start this process with a brainstorm and create a list of potential names for your organization. When you have your list, conduct a business name search and a trademark search through the Georgia Secretary of State Corporations Division.

You will also want to perform a federal search on the United States Patent and Trademark Office (USPTO) website.

The purpose of this search is to ensure you choose an available name. If you operate your nonprofit under a name already in use or trademarked, you could face legal problems.

Under Georgia law, the name of a nonprofit corporation must include the words "corporation," "incorporated," "company," or "limited." Alternatively, you could use an abbreviation for one of these or a similar term.

You can reserve a business name for 30 days if you're not ready to start your nonprofit officially. You can reserve up to three names (in case your first or second choices are already taken) for a $25 filing fee.

You will use the name you choose for your organization on your website, brochures, and other items. Ensure it's consistent with your mission statement and purpose. It should also be memorable and distinctive.

A registered agent is a person or company that can receive legal papers on your behalf. For example, if someone needs to provide you with legal documents as part of a lawsuit, your registered agent will receive the paperwork for you.

If you can't find someone who can serve as your registered agent, you can pay a company to provide registered agent services. The person or company that serves as your registered agent must be available to receive legal papers during regular business hours. They must also have a physical address in Georgia.

In Georgia, you must have a board of directors for your nonprofit organization. The board of directors has the task of overseeing operations. Choose the people who will serve as your organization's directors carefully. Keep in mind the requirements of the state of Georgia and the Internal Revenue Service (IRS).

Georgia requires that you have at least one director for your organization. But the IRS requires that the organization have at least three directors. If you plan to seek tax-exempt status, you should get three unrelated people to serve as directors for your organization.

A director for a nonprofit organization should be at least 18 years of age.

You'll also need to have officers for your nonprofit corporation. Often, the board of directors elects the officers. Officers are responsible for handling the day-to-day tasks.

Corporate bylaws are essential because they typically contain rules and procedures for your organization. In case of any disagreement, those in the organization can look to the bylaws for guidance. A court may look to the corporate bylaws to resolve a legal dispute.

Your bylaws should include the following information:

• Name and location of the corporation
• Names of directors and officers
• Duties of directors and officers
• Procedures for meetings
• Procedures for amending the bylaws

Often, the person who writes the bylaws is the incorporator (the person who files the articles of incorporation with the Secretary of State). But there is no requirement to file the bylaws with any agency. Store your corporate bylaws in a safe place after they're adopted.

To form your nonprofit corporation, you must file articles of incorporation with the Georgia Secretary of State. Articles of incorporation typically include the following information:

• Name, location, and mailing address of the corporation
• Statement of purpose
• Name and location of registered agent
• Name of incorporator

There are other statements you should include in your articles of incorporation—particularly if you apply for tax-exempt status. For example, you should have a statement that your organization will not engage in activities unrelated to the express purpose of the organization. If you dissolve your nonprofit, you'll also need a statement that the corporation's assets will go to another 501(c)(3) corporation or the government.

Your articles of incorporation must also explicitly state that “the corporation is organized pursuant to the Georgia Nonprofit Corporation Code."

You must submit a $110 filing fee for your articles of incorporation. You also need to submit a transmittal information form with your filing. The transmittal information form is a certification that you have filed your articles of incorporation and will publish a notice of incorporation.

You must file the notice of incorporation the day of or the next business day after filing the articles of incorporation. It's best to publish the notice of incorporation in the county newspaper.

Include the following information in your notice of intent to incorporate:

• Name of the corporation
• Name of the registered agent
• Location of the registered agent

Once the newspaper has published your notice for two consecutive weeks, they will send you an affidavit (or written statement). You don't need to file your notice with the Georgia Secretary of State. But you should keep the affidavit for your corporate records.

Finally, you'll need to file your initial annual registration form. You must file this initial annual report within 90 days of incorporation. A $30 filing fee is also associated with the initial yearly registration for nonprofit corporations.

You must apply for an Employer Identification Number (EIN) through the IRS. Your EIN is like a social security number but for your business. You will use this number for tax purposes, and you may need it to open a bank account for the corporation.

The fastest and easiest way to apply for an EIN is through the IRS website. You can also file Form SS-4 if you prefer to apply by mail or fax.

It's free to apply for an EIN through the IRS. When applying, make sure you use the official IRS website—some commercial sites charge a fee for an EIN.

You should conduct the initial organizational meeting of your board of directors as soon as possible. Be prepared to record the minutes of this meeting—it will accomplish several critical pieces of business.

At the initial meeting, it's typical for board members to:

• Select officers
• Adopt the bylaws
• Pass resolutions, including opening a business bank account

The board may also approve corporate policies at this time.

If you believe your organization qualifies as a 501(c)(3) charitable organization, you can apply for federal tax exemption. If you're forming a nonprofit corporation, you must start the corporation before applying for 501(c)(3) tax-exempt status. Use IRS Form 1023 or IRS Form 1023-EZ to apply for tax-exempt status.

After you apply, the IRS will issue an acknowledgment notice saying they have received your application.

You will receive a determination letter once the IRS has reviewed your application. The determination letter will tell you whether the IRS has approved your request or if they need more information.

Applying for 501(c) status helps with income taxes and opens up funding opportunities. For example, securing and maintaining 501(c) status may help you secure grants. Grants are one of the primary ways to grow a nonprofit.

Tax-exempt status at the federal level doesn't automatically exempt your organization from state sales tax. But most states recognize an IRS determination letter. To get tax-exempt status at the state level, you can file your determination letter (and any other required documents) with the Georgia Department of Revenue (DOR).

Although you may get tax-exempt status for income tax, Georgia handles sales and use tax differently. Georgia generally doesn't grant sales and use tax exemption to nonprofit organizations.

Only a few types of nonprofit organizations qualify for a sales and use tax exemption in Georgia. This means you'll likely have to pay tax on purchases and sales.

You may need to register your Georgia nonprofit as a charitable organization. This registration allows you to solicit donations for your organization. Most nonprofits rely on fundraising and grants to fund their missions.

Complete your charitable organization registration through the Charities Division of the Georgia Secretary of State. The application has a $35 filing fee.

You must renew your registration and pay a $20 renewal fee every 24 months.

You may need a business license or permits to operate your Georgia nonprofit. The licenses and permits needed depend on the type of organization you're running and its location. Check with your local business licensing authority for requirements for your nonprofit.

Use the Georgia Chamber of Commerce directory to find the agencies that regulate business licenses in your county.

The Small Business Administration (SBA) also has a helpful tool you can use to find taxes, zoning laws, and licensing regulations for your business.

Nonprofits operating in Atlanta city limits can find business licensing requirements on the City of Atlanta Office of Revenue website.

You'll want to open a bank account in your nonprofit's name as soon as possible. The bank will need specific information about your nonprofit, including:

• Articles of incorporation
• Bylaws
• EIN

In some cases, you may need to provide a copy of your directors' resolution to open a bank account. A director's resolution is a document detailing your board of directors' decisions. It can be used to authorize certain actions in place of an official meeting.

Store your corporate documents in a safe place—you may also need them to complete other tasks for your organization.