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Are you excited about an environmental cause and want to lead a group that champions this cause? You may want to think about establishing your own nonprofit! Although the idea may seem daunting, it is not as challenging as you think. Below you will find seven easy steps to start your own nonprofit in our nation’s capital!
Before we begin, let’s define what a nonprofit organization is. According to the DC government, a nonprofit organization is one that “does not operate for the purpose of generating profits for private individuals. It has no owners, partners or shareholders. It pays no dividend and distributes no profits to any person.” (DC Bar Pro Bono Program) Still sound like something you’d be interested in? Great! Keep reading…
Step 1: Creating a Name
Probably the most important and enjoyable step to starting your nonprofit is selecting a name! There are several DC naming requirements to consider, so be sure to check the list here. To get you started, the name should include “corporation”, “incorporated”, “company”, or “limited”, or the abbreviation “Corp.”, “Inc.”, “Co.”, or “Ltd.” While brainstorming ideas, it is important to do a bit of online research to ensure that no other organizations are already operating under the name you’d like to use. Finally, check to see if the URL for your chosen name is available. I like to use GoDaddy for this purpose. Not only does this site let you know which URLs are available, but you can also purchase your chosen URL through the site so no one else can snatch it up.
Step 2: Choose your Officers and Board of Directors
Who is going to run your organization? The board of directors will be responsible for overseeing the operations of your nonprofit and the officers will fill the other roles in your organization, such as the president, secretary, etc. According to DC law, you must have three directors (who are not related to each other), an officer assigned to the management of the organization, and an officer assigned to overseeing the group’s financial affairs.
*Step 3: Establish the Organisation's By-Laws
By-Laws are the rules outlining the operating procedures of your nonprofit.
*Step 4: Set up a Conflict of Interest Policy
The conflict of interest policy is a collection of rules that ensure that any decisions made by the board of directors or officers benefit your nonprofit, rather than those individuals.
*The By-Laws and Conflict of Interest policy should be adopted during the nonprofit’s first organizational meeting. Board members and officers should also be officially appointed at this time.
Step 5: File the Washington DC Articles of Incorporation
In order to be eligible for 501(c)(3) status, you must outline your purpose and plan for dissolution in the Articles of Incorporation. In DC, the purpose of the nonprofit must be explicitly limited to one or more of the following: charitable, religious, scientific, educational, literary, fostering national/international amateur sports competition, preventing cruelty to animals/children, or testing for public safety. (Environmental work would fall under the scientific and/or educational categories.) A dissolution plan outlines what the assets of the organization will be used for, and what will happen to these should the organization be dissolved.
Step 6: Acquire an EIN
EIN stands for Employer Identification Number. It acts like your organization’s social security number and is required in order to open a bank account for your nonprofit, for Federal and State tax purposes, and to hire employees. You can request an EIN number from the IRS.
Step 7: Apply for 501(c)(3) Status
Once all of the above steps are completed you should be eligible to apply for 501(c)(3) status. This status exempts your nonprofit from paying federal taxes. To apply, fill our Form-1023 online. Once approved, you will receive a letter from the IRS (which can take up to 180 days).
For more detailed information on these steps, please check out this document created by the DC Bar Pro Bono program.
Sources:
DC Bar Pro Bono Program. (2013, July). Starting a Nonprofit in D.C.: A Guide. Retrieved August 7, 2020, from https://opgs.dc.gov/sites/default/files/dc/sites/opgs/page_content/attachments/CED%20.pdf
TRUIC. (2020, July 27). How to Start a Nonprofit in Washington D.C. Retrieved August 7, 2020, from https://howtostartanllc.com/form-a-nonprofit/washington-dc-nonprofit#5
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