How to Form a 501c3 Nonprofit Corporation in California
Anyone who wishes to form a 5013 nonprofit corporation in California must first
register their nonprofit business in the state of California. This is done in the
same way a for-profit business registration is done: by filing Nonprofit Articles
of Incorporation with the state, pursuant to the Nonprofit Corporation Law of the
California Corporations Code. California distinguishes between three types of nonprofit,
nonstock corporations: Religious, Public Benefit, and Mutual Benefit.
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After your nonprofit corporation is registered with the state, if your business
is formed for scientific, religious, charitable, literary, or educational purposes,
you can apply for 501c3 status with the IRS. This status, and the tax benefits associated
with the status, is not available to businesses formed for profit or to nonprofit
corporations not formed for one of the above purposes. If you improperly attempt
to gain 501c3 status, your application will be denied.
Register your Nonprofit Corporation in California
Your Nonprofit Corporation’s Articles of Incorporation will include much the same
information as a for-profit California corporation, with the exception of a more
detailed purpose statement and, if applicable, the clauses required by the IRS in
order to later obtain 501c3 status.
Your Nonprofit Articles will include, at minimum, the following:
- Business name as you wish it to be legally recorded
- Type of nonprofit (Public Benefit, Mutual Benefit, Religious)
- Specific purpose statement
- Registered Agent’s name and address
- Certain language the state and/or IRS will require in order to grant tax-exempt
Once placed on file by the Secretary of State, your organization becomes a legal
entity and is authorized to do business in the state of California. If you intend
to form a 501c3 Nonprofit Corporation, you are now able to begin the tax-exempt
status application process with the IRS.
Applying for 501c3 Tax-Exempt Status from the IRS
There is a great deal of information the IRS will need about your business in order
to grant you tax-exempt status. Some of the information you can expect to provide
is as follows:
- Form 1023
- Articles of Incorporation, including specific 501c3 language
- Three years of donation estimates
- Detailed description of your business activities
- Three years of expense estimates
- Conflict of Interest form
- Information about any organization from which you are involved in fundraising or
- Depending on the amount of compensation they are to receive, a list of any independent
contractors or officers
- Copies of any leases or contracts with any of the above persons
This is by no means a comprehensive list of the information the IRS will require.
Depending on your intended business activity, you may be required to provide further
information or documentation.
When you use Click and Inc to file your 501c3, we make sure the required 501c3 language
is present in your state Articles of Incorporation from the very beginning. Learn
more about forming a 501c3 Nonprofit.
Further Responsibilities of a California Nonprofit Corporation
All corporations in California, whether nonprofit or for-profit, must submit a Statement
of Information within 90 days of filing. Future Statements of Information must be
In California, nonprofit entities are taxable; until your corporation has formally
obtained tax-exempt status from the Franchise Tax Board, it will be responsible
for paying a minimum $800 franchise tax along with its annual return.
If any of the above information changes, you will need to
file an amendment to alert the state of those changes. Failure to do so
could result in the state being unable to contact you with valuable filing and renewal
notices, which may cause certain late fees to be incurred.
You will be required to obtain an Employee Identification Number, also known as
an EIN. The EIN is obtained through the IRS. It is best to check with the IRS or
a legal advisor to determine what other IRS requirements are present for a 501c3
Depending on your purpose and your local jurisdictions, you may be required to open
any number of Business Licenses at the state, county, or town level. Learn more
about our Business License
Services to streamline the process.
Other Types of Businesses in California
For information on other types of businesses in California, please explore the links