The first step toward forming a nonprofit corporation is to file articles of incorporation with the appriopriate state office. In most states, this is the office of the Secretary of State.
The Articles of Incorporation for a nonprofit corporation must contain certain language as mandated by the Internal revenue Service if it intends to qualify for Federal tax exempt status.
Under Section 501(c)(3) of the Internal Revenue Code, a nonprofit corporation may be exempt from taxation and may be eligible to receive tax-deductible donations from its contributors.
A common reason for forming a nonprofit corporation may be:
The IRS defines exempt purposes as “charitable, religious, educational, scientific, literary, testing for public safety, fostering national or international amateur sports competition, and preventing cruelty to children or animals.”
The term “charitable” is used in its generally accepted legal sense and includes relief of the poor, the distressed, or the underprivileged; advancement of religion; advancement of education or science; erecting or maintaining public buildings, monuments, or works; lessening the burdens of government; lessening neighborhood tensions; eliminating prejudice and discrimination; defending human and civil rights secured by law; and combating community deterioration and juvenile delinquency.
To form a nonprofit corporation: