So you want to form a tax exempt nonprofit corporation? Here are the basic legal steps required to incorporate under California laws, get tax exempt status at the federal and state level, establish basic corporate governance and complete other initial filings.

1. Choose a corporate name and determine availability. Reserve the name and/or trademark the name, if appropriate and desired.

• Determine availability and reserve a name through the California Secretary of State: http://www.sos.ca.gov/business/be/name-availability.htm
• Trademark the name at the federal level through the U.S. Patent and Trademark Office: http://www.uspto.gov/trademarks/index.jsp
• Trademark the name at the state level at the California Secretary of State: http://www.sos.ca.gov/business/ts/

2. Prepare and file articles of incorporation with the Secretary of State.

• The California Secretary of State website provides tips on completing Articles: http://www.sos.ca.gov/business/be/filing-tips-corp.htm#artsnp

3. Draft bylaws of the corporation in compliance with California law.

• Sample annotated bylaws are at Public Counsel Law Center’s website: http://www.publiccounsel.org/publications?id=0060
• The California Franchise Tax Board also provides some guidance at the end of its Form 3500 instruction booklet: https://www.ftb.ca.gov/forms/misc/3500bk.pdf

4. Set up a corporate records book (“a minute book”).

5. Draft an action of incorporator to appoint the initial corporate directors and adopt the bylaws.

• Sample action of incorporator is here.

6. Apply on-line and obtain a federal Employer Identification Number (FEIN).

• Apply on-line with the IRS at: http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Employer-ID-Numbers-(EINs)-

7. File the first Statement of Information with the CA Secretary of State.

• These can be filed on-line: http://www.sos.ca.gov/business/corp/pdf/so/corp_so100.pdf

8. Register with the California Attorney General’s Registry of Charitable Trusts.

• Initial registration form: http://oag.ca.gov/sites/all/files/pdfs/charities/charitable/ct1-form.pdf?
• Guide for Initial Registration: http://oag.ca.gov/sites/all/files/pdfs/charities/charitable/initialReg.pdf?

9. Hold the first meeting of directors, elect officers, determine principal office, establish bank account, establish accounting year and take other appropriate board actions.

10. File for tax exempt status with the IRS.

• Form 1023 and instructions for 501(c)(3) organizations: http://www.irs.gov/pub/irs-pdf/i1023.pdf
• Form 1024 and instructions for other 501(c) organizations: http://www.irs.gov/pub/irs-pdf/i1024.pdf
• IRS Publication 557, Tax Exempt Status for your Organization: http://www.irs.gov/pub/irs-pdf/p557.pdf

11. File for tax exempt status with the California Franchise Tax Board.

• Form FTB 3500 and instructions: https://www.ftb.ca.gov/forms/misc/3500bk.pdf
• Form FTB 3500A: https://www.ftb.ca.gov/forms/misc/3500a.pdf

12. Apply for a nonprofit mailing permit with the U.S. Postal Service.

• Form PS 3624, Application to Mail at Nonprofit Standard Mail Prices: http://about.usps.com/forms/ps3624.pdf

13. Establish procedures to make required periodic filings with the Internal Revenue Service, the California Franchise Tax Board and the California Attorney General and Secretary of State.

Further reading:

California Attorney General’s Guide for Charities: http://oag.ca.gov/sites/all/files/pdfs/charities/publications/guide_for_charities.pdf?

Public Counsel Law Center, Community Development Project Resources for Developing a Tax Exempt California Nonprofit Corporation: http://www.publiccounsel.org/pages/?id=0022

Anthony Mancuso, Forming a Nonprofit Corporation in California, Nolo Press (2011): http://www.nolo.com/products/how-to-form-a-nonprofit-corporation-in-california-non.html