How To Start a Nonprofit in Oregon

Oregon requires every nonprofit organization to register with a unique name. Conduct a business name search through the Oregon Secretary of State website to ensure your nonprofit’s name is not already in use.

You should also do a federal business name search. Search for your selected business name on the trademark database through The United States Patent and Trademark Office (USPTO) website.

Oregon law has naming requirements for nonprofit corporations. Your nonprofit’s name cannot:

• Include the words "cooperative" or "limited partnership"
• Be misleading
• Suggest your nonprofit operates with any purpose other than the purpose you filed

After your research, register your business name online with the Oregon Secretary of State.

You should also purchase the domain name and secure social media profiles for your selected business name.

A registered agent is a person or company located in Oregon designated to receive legal documents, like a summons for a lawsuit. State law requires that every nonprofit have a registered agent named in its articles of incorporation. A registered agent may be an individual or a company that operates a registered agent service.

Oregon law requires every corporation to have a board of directors. Your board of directors provides governance, oversight, and strategic direction for your organization.

Under Oregon law, every public benefit corporation’s board of directors must consist of at least three individuals. These three roles must include a president and a secretary.

Your board members should be like-minded and want to further the nonprofit’s purpose.

Oregon law has placed specific duties on members of the board of directors. The board of directors must ensure that the nonprofit’s actions are legal. The board of directors also has the duty of care and loyalty.

• Duty of care: The board of directors exercises its duty of care when it uses reasonable care to make decisions for and on behalf of the nonprofit. All decisions made by the board of directors must be to further the nonprofit’s purpose.

• Duty of loyalty: This means board members must act in the nonprofit’s best interest, not their own best interests. The duty of loyalty also requires the board of directors to ensure the nonprofit remains financially solvent.

Your nonprofit must have bylaws and a conflict-of-interest policy. Without them, you will be ineligible for 501(c)(3) tax-exempt status.

Bylaws are the set of rules that govern the operation of a nonprofit corporation. Some details in your bylaws depend on the type of work your nonprofit does. But most bylaws include:

• Your organization’s name, address, and primary place of operation
• Names and offices of directors and officers
• Procedures for board meetings
• Protocol for filing annual reports
• Procedure for amending articles of incorporation and bylaws

A conflict-of-interest policy lays out rules that limit the self-serving actions of the board of directors and officers. It ensures that every decision the leadership makes is in the nonprofit’s best interest.

You must file the articles of incorporation for your nonprofit with the Oregon Secretary of State Corporation Division. The filing fee is $50.00. Find the form and instructions for filing here.

In the articles of incorporation, you must state your nonprofit’s purpose. The Internal Revenue Service (IRS) must approve your nonprofit’s purpose for tax-exempt status.

Other details you should include in your articles of incorporation include:

• Name and address of the organization
• Name and address of the registered agent
• Bylaws and conflict-of-interest policy
• Names and addresses of at least one incorporator

You also must address the dissolution of your nonprofit in your incorporation articles. Dissolution refers to a business shutting down. As a part of the dissolution, your articles of incorporation must explicitly state how your nonprofit will divide and distribute its assets.

Your initial organizational meeting of the board of directors will occur after you have filed the articles of incorporation with the Secretary of State. This initial organizational meeting will need to accomplish several business objectives, including:

• Electing directors and officers
• Formally adopting bylaws and conflict of interest policy
• Setting your nonprofit’s management structure
• Adopting various resolutions, like opening a business bank account

An employer identification number (EIN) is like a social security number for your business. Every business and nonprofit must get an EIN from the IRS. It’s used for identification and tax purposes.

To get an EIN from the IRS, you must complete an application on the IRS website, by mail, or by fax. The IRS doesn’t charge a fee for an EIN. Any website requiring a fee isn’t the official IRS website.

501(c)(3) status is a federal tax status available only for nonprofits pursuing specific goals. Generally, nonprofits can only obtain 501(c)(3) status if formed for one of the following purposes:

• Charitable
• Religious
• Scientific
• Educational
• Literary
• Fostering a national or an international amateur sports competition
• Preventing cruelty to animals or children
• Testing for public safety

If your nonprofit’s purpose falls within one of the above categories, you can apply for an exemption by completing IRS Form 1023 or IRS Form 1023-EZ.

If the IRS approves your application, you will receive a determination letter stating you are exempt from paying federal income taxes.

There is no additional application for Oregon state tax exemptions. If the IRS approves your nonprofit for federal tax exemptions and you operate in the state, you’re automatically exempt from state taxes.

You must send your determination letter from the IRS to the Oregon Department of Revenue.

Your nonprofit may be eligible for a property tax exemption. Contact your local assessor for filing requirements and to see if your nonprofit qualifies for exemptions.

The state of Oregon doesn’t impose sales taxes.

If your nonprofit is a charitable organization, it must register with the philanthropic activities section of the Oregon Department of Justice (DOJ). You can submit the Form RF-C online with the department.

You must register with the DOJ before you begin accepting donations or fundraising. There is no fee for the initial registration. But you must pay an annual fee on a sliding scale (between $50 and $300) based on your nonprofit’s annual income.

You may need local business licenses or permits, depending on the specifics of your nonprofit and your location.

Use the Small Business Administration Business License and Permit Lookup Tool to find federal, state, or local permits your organization may need. The Nonprofit Association of Oregon also has resources for new and existing nonprofits.

Use the Business Information Center section of the Oregon Secretary of State website to find license and zoning requirements for your nonprofit. You can also use their helpful license directory.

Most states require nonprofits to file an annual report. In Oregon, an annual report is called a yearly business renewal.

An annual report is a yearly performance review that gives up-to-date information about your nonprofit. You must file your business renewal with the Oregon Secretary of State each year on your nonprofit’s incorporation anniversary.

The Secretary of State automatically issues renewal notices about 45 days before your due date.