As per the National Center for Charitable Statistics, there are more than 7000 non-profit organizations in Nevada in 2012. This means that you can easily and successfully start a nonprofit in Nevada. But before you do so, ensure that you have noted all the unmet needs in your community and make sure that there are not any other existing organizations serving the same cause. In case another organization exists, it is better to consider working together.
The moment you are ready to start your nonprofit in Nevada, you will need to apply for the 501(c)(3) status. Additionally, you will need to get a non-profit business license in Nevada. There are many formalities that you will need to take care of. This guide will walk you through the basic steps to commence your nonprofit in Nevada. So, let us get started!
Steps to form a Non – Profit organization in Nevada
Below shared are the steps to start a nonprofit in Nevada:
Step 1: Get A Name For Your Nonprofit
The very first thing that you need to do is to select a name for the nonprofit so that it can then be established as a brand. Ensure that the name is great since it would be the first thing that most people learn about your organization. So, it is very crucial to pick a name that both aligns with your mission and follows the rules of naming in Nevada.
To help you a bit, here are some of the rules for naming a nonprofit in Nevada:
- The name that you pick should not include any of the following without special permissions:
- “accountant”, “accounting”, “accountancy”, “auditor” or “auditing”.
- “registered residential designer”, “licensed residential designer”, “registered interior design”, “residential designer”, “licensed architect”, “registered interior designer”, “architect”, “architecture”, “registered architect” or “residential design”.
- “trust”, “engineer”, “engineering”, “engineered”, “professional engineer” or “licensed engineer”.
To find out the detailed list, check out the state’s official guidelines for the complete rules on naming a Nevada-based nonprofit organization.
Other than this, you will have to ask the following questions when choosing the name:
- Is the Name Available? The name of the nonprofit should be a unique one unlike any other corporation in Nevada. You can use the tool available on our website to see if the name is available or not.
- Is the Website Domain Name Available? In case you want to have a website for your organization, you will have to ensure that a suitable URL is available for it. Use the Search Engines to check it. And it is better to reserve the URL once you find it so that no one else buys it before you are ready to work on the website.
Step 2: Appoint A Nevada Registered Agent
The nonprofit corporation in Nevada is required to have a registered agent with a Nevada address. To explain better, a registered agent is an individual or business entity that is responsible for getting the important legal documents on behalf of the business. Basically, the registered agent is the point of contact for your business with the state.
A registered agent has to be a resident of Nevada or a corporation, such as a registered agent service like IncParadise, who is authorized to transact business in Nevada. You have the choice to elect an individual within the company including yourself if the company is based or the person is based in Nevada.
Step 3: Select Your Board Members & Officers
The directors of a nonprofit are responsible for overseeing the operations of the organization. They all come together to form the board. The features of these directors include:
- Every director of the organization together forms the board of directors.
- The influence and the power of the directors over the company are as the board of directors. None of the directors have any authority over the organization as an individual.
- The board normally creates policies that govern the nonprofit.
- The board of directors normally oversees the management-level hiring like that of the officers.
The officers of the nonprofit such as the president or the secretary are individuals with responsibilities, and the authority to execute based on their job descriptions. Together, the board and the officers will come together to make the organizational structure of the nonprofit.
Just so you know, the office can also be on the board of directors and serve both roles in case they are allowed to do so by the organizational bylaws created by your team. The organization structure of the nonprofit in Nevada has to include at least 3 directors who are not related to each other:
- A president
- A secretary
- A treasurer
NOTE: Two or more offices may be held by the same person.
Step 4: File The Nevada Articles of Incorporation
To become a nonprofit corporation in Nevada, you will need to file the Articles of Incorporation with the Secretary of State. Here are the sections that you will have to fill in this form:
- Section 1: Name of Entity
- Section 2: Registered Agent & Registered Office
- Section 3: Directors
- Section 4: Purpose – share the purpose and reason to start a nonprofit in Nevada. This will help you qualify for the 501(c)(3) status. And the purpose of the organization has to explicitly be limited to one or more of the following:
- Testing for public safety
- Literary
- Scientific
- Religious
- Charitable
- Fostering national/international amateur sports competition
- Preventing cruelty to animals/children
Note: Read the IRS guidelines for this properly.
- Section 5: Incorporators – this is a person who completes, signs, and submits the certificate of formation. This person doesn’t have to be a part of your organization. It can be anyone like the registered agent or even the lawyer helping you.
- Section 6: Registered Agent Signature – The selected registered agent has to complete and sign this section. If they are not able to do so, you will have to submit a separate Registered Agent Acceptance Form.
- Section 7: Supplemental Provisions/ Information – You will have to add a small sheet to this form formally stating what the assets of your organization will be used for and what would happen if the assets were dissolved. It is important to convince the IRS that the organization’s assets would always be used under the 501(c)(3) rules. End this with provisions ensuring that in the event your organization is dissolved, the assets of the organization will be used towards tax-exempt purposes.
This can be submitted to the IRS in two ways: in-person or by mail. The filing fee for this is $50 for the Articles of Incorporation and $25 for the Initial List of Officers/Directors. Checks have to be made payable to the “Secretary of State.” The overall process would take about a week and this can be reduced to a day with an additional expedite fee of $125. You can contact the Secretary of State at (775) 684-5708 or visit them at their website.
Nonprofit Operating Procedures & Housekeeping
Once you have done this, you will have to follow some procedures to stay compliant when you start a nonprofit in Nevada. These include the following:
1. Draft Bylaws And Conflict Of Interest Policy
There are two kinds of documents that would be central to the running of your nonprofit. These include:
- Bylaws: These are the rules to dictate how the organization will run and be governed. You can consider it to be a constitution for your nonprofit. In short, it makes the rules and priorities clear for everyone. Things that you need to add in the bylaws include:
- How will the nonprofit be governed?
- The roles of the officers & directors.
- How do the records need to be kept and managed?
- How do the disputes have to be handled?
- How would the bylaws be added or amended in the future?
- How meetings are held, electing directors or officers, and voting procedures?
- The Conflict of Interest Policy: These are the rules set to make sure that the decisions that are being made for the nonprofit would depend on what is best for the organization, and not being motivated by what is best for individuals. Under Appendix A the IRS provides a sample Conflict of Interest Policy.
Note: It is important to have these two documents prepared before the first organizational meeting.
2. Conduct An Organizational Meeting
The next thing you need to take care of is conducting the organization meeting for the company. This is the first meeting of the nonprofit organization. In this meeting, some of the things that will be discussed include:
- Adoption of conflict of interest policy
- Adoption of the bylaws
- Appointing temporary officers, chairmen, secretary, etc.
- Taking attendance to show you have a quorum (minimum number needed)
It is also important to record the minutes of the meeting and have it signed by all the directors. Also, it should be noted that this meeting has to take place before the organization can apply for the 501(c)(3) federal tax-exempt status.
3. Get An EIN
You will need an EIN, which is the Employment Identification Number (also called a Federal Tax Identification Number or Federal Employment Identification Number). It is used to uniquely identify a business entity and is needed even if you do not have any employees in the organization. You can apply for this with the Form SS-4.
4. Open A Business Bank Account
Opening a bank account is important to keep all the business transactions different from the personal one. And for this, you will need:
- The EIN for the nonprofit
- A copy of the nonprofit’s bylaws
- A copy of the Articles of Incorporation
In case your nonprofit has multiple officers or directors, you will need to share proof that they have authorized the opening of a bank account for the nonprofit. Keep in mind to always call ahead before you go there as you will be able to learn if you need to carry some additional documents with you.
5. Start a Corporate Records Book (Optional)
Being a nonprofit organization, you will have to keep track of many important documents. This includes documents such as the meeting minutes, nonprofit bylaws, tax forms, EIN and Articles of Incorporation. For this, it is recommended to start a dedicated corporate records book so that you can keep track of all the important legal documents right from the start.
How to apply for tax exemptions?
There are some things that your nonprofit organization has to apply for. These include:
- the IRS to be exempt from federal taxes, and
- the Nevada Department of Taxation for exemption from sales taxes.
1. Applying for Exemption from Federal Taxes – 501(c)(3) Status
Before you can apply for the 501(c)(3) status, the above steps should have been done and completed. This means that you need to start a nonprofit in Nevada, get the Articles of Incorporation, prepare the bylaws and get the EIN. And then, for filing for the tax-exempt status, most of the organizations would need to file the Form 1023 online or by mail. The fee that goes with this form is $600.
There are two exceptions in this:
- In case the annual gross receipts in your organization are below $50,000, then you might be able to file Form 1023-EZ for the fee of $275.
- And if your organization is a religious institution or has annual gross receipts in each taxable year of no more than $5000, you might be considered tax-exempt without filing Form 1023.
Note: Organizations and religious institutions with gross receipts under $5000 can still choose to file Form 1023. With this, they would get a determination letter that would specify that contributions to the organization are tax-deductible.
The form 1023/1023-EZ has to be filed within 27 months from the end of the first month since the organization was created. If your application is simple and complete, the IRS will send your determination letter within:
- 90 days for Form 1023-EZ
- 180 days for Form 1023
If you have not heard from them by that time you can call (877) 829-5500 to enquire about your application.
2. Applying for Exemption from State Taxes
Nevada doesn’t levy corporate income tax but does levy a privilege tax. To get the exemption, file the exempt status entity form. And after filling it, you will have to submit it to the address: Nevada Department of Taxation at 1550 College Parkway #115, Carson City, NV 89706-7921. For more information, you can call the Department of Taxation at (775) 684-2000 or visit them at their website.
How to Keep Your Nonprofit Compliant?
Along with the steps shared above, you will also have to work towards keeping your nonprofit compliance once you start a nonprofit in Nevada. The things you need to take care of include:
- Getting a Registered Agent: You will have to maintain a registered agent with the office address in Nevada as shared above. If the address is changed, then you will have to file the Statement of Change of Registered Agent with the Secretary of State.
- File Required Periodic Reports: Every year on or before the last day of the month when the organization was registered, you will have to file the annual list of officers and directors with the Secretary of State.
- Determine the Nevada Business Permits & Licenses: As soon as your nonprofit has got the 501(c)(3) status, it is exempt from paying $200 for a Nevada Business License. To be exempt you must file the Declaration of Eligibility of State Business License Exemption with the Secretary of State.
- Fundraising: If your organization will be soliciting for donations it must file a Charitable Solicitation Registration Statement with the Nevada Secretary of State.
- Employees: If your nonprofit has employees, you will have to register with the Nevada Employment Security Division using (Form APP-01.00) and (Form NUCS-4058).
For more information, you can call the Secretary of State at (775) 684-5708, email them at sosmail@sos.nv.gov, or visit them at their website.
Public Inspection Rules for 501(c)(3) Organizations
The nonprofits that have received the 501(c)(3) status need to disclose the following documents to the public when requested:
- The official paperwork from the IRS that shows that your organization has tax-exempt status.
- Application of exemption and all supporting documents such as Form 1023
- All Form 990 Schedules (except portions of Schedule B), attachments and supporting documents.
- Annual returns for 3 years after the due date (this includes returns like Form 990, 990-EZ, 990-PF, and any Forms 990-T)
Annual Returns for Tax-Exempt Organizations
A lot of the tax-exempt nonprofit organizations are needed to file an annual return with the IRS. The form that you will need to use for filing the annual returns depends on the annual gross receipt amount for your organization. The “gross receipt” is defined by the IRS as the “total amounts the nonprofit got from all sources during the annual account period, without subtracting any expenses or costs”. Below shared are the forms you will have to fill based on the amount on the gross receipts:
- For gross receipts < $50,000 — File 990-N
- Gross receipts <$200,000 and total assets <$500,000 — File 990-EZ
- Gross receipts > $200,000 or Total assets > $500,00 — File 990
For any questions, you can call the IRS at (800) 829-3676 (Form-related questions) or (800) 829-1040 (General information). This form has to be filed within 4 months after your tax year comes to an end. This means that it is due on the 15th day of the 5th month. It should be noted that if your nonprofit fails to file the form 990 for 3 years continuously, it will automatically lose its tax-exempt status.
Report Unrelated Business Income
If your organization has a gross income that is greater than $1000 from a trade or business that is not related to the stated purpose of the organization, then it must file Form 990-T to pay tax on that income. If you expect to pay $500 or more for the year in taxes on unrelated business income, your organization must pay a quarterly estimated tax on the unrelated business income using Form 990-W.
How can IncParadise help you?
With all this information, you can now move ahead and start a nonprofit in Nevada easily by following the steps. You can easily turn your passion into a legitimate nonprofit corporation exempt under the IRS 501(c) and that benefits your community. Remember to stay compliant with the rules to keep the IRS 501(c) status. To register and incorporate your nonprofit in Nevada, IncParadise can help you. Connect with us to begin the process today!
