How to Start a Nonprofit in California
To incorporate a nonprofit in California, file nonprofit Articles of Incorporation with the California Secretary of State. This filing officially creates your corporation, but it is really just one step toward pursuing your nonprofit’s goals. The main steps to starting a California nonprofit corporation are as follows:
- Decide which type of nonprofit you want to form (a nonprofit public benefit, mutual benefit, or religious corporation)
- File nonprofit Articles of Incorporation
- Get a federal EIN from the IRS
- Hold your first official meeting and adopt bylaws
- Apply for a California tax ID and seller’s permit
- Apply for federal and/or state tax exemptions
- Register as a charity
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California nonprofit Articles of Incorporation free download. When you’re done filling out the form, submit it to your state.
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How to File California Nonprofit Articles of IncorporationTo form a nonprofit in California, file the nonprofit Articles of Incorporation in the following steps:
How Much Does It Cost to Incorporate a California Nonprofit?
The basic filing fee is $30 if you send in your articles by mail and if you’re fine with the 30-day processing time. California charges an additional $15 “counter drop off” fee (so $45) if you deliver your nonprofit’s articles in person. It costs $120 for 14-day filing, and $450 for 1-day filing. Hire Northwest and get your Articles processed in as little as 1 day for a total, out-the-door cost of $675. Or, save some money and choose from other filing times: 14 days ($345) or 30 days ($275). Every option gets you a full year of registered agent service.
If your nonprofit is a charity, you’ll also pay a $25 to register with the California Attorney General’s Registry of Charitable Trusts.
How Much Does A Nonprofit Cost Each Year?
California nonprofits submit statements of information every other year (what most states call a “biennial report”), and this comes with a fee of $20. Additionally, if your nonprofit is a California registered charity, you’ll need to renew your registration annually, which can cost anywhere between $0 and $300 depending on your nonprofit’s yearly revenue.Get Started
What Is The California Statement Of Information?
Within 90 days of incorporating your nonprofit, you’ll need to pay a $20 filing fee and submit the California Statement of Information to the Secretary of State’s office. This report updates your nonprofit’s contact and membership information for the state. After you submit the first report, you will submit a California Statement of Information every other year by the end of your nonprofit’s anniversary month, and pay a $20 fee each time.
If you don’t want to bother keeping up with the deadline or filling out this document yourself, pay an additional fee when you hire Northwest, and sign up for our Statement of Information Compliance service.Learn More
Will My California Nonprofit Be Tax-Exempt?
Not automatically. To obtain federal tax-exempt status, your California nonprofit must apply directly to the IRS by submitting an Application for Recognition of Exemption. This is a lengthy, difficult process in which the IRS examines your nonprofit’s history, purpose, organizational documents, and finances to determine if your nonprofit corporation is organized exclusively to pursue one or more exempt purposes recognized by the IRS. Currently the IRS recognizes more than two dozen different types of exempt organizations, but most nonprofits, including religious corporations and most public benefit corporations, apply for 501(c)(3) federal tax-exempt status for public charities and private foundations.
If your nonprofit manages to obtain federal tax-exempt status, that doesn’t mean it’s automatically exempt from California state taxes, and it’s also possible for your nonprofit to qualify for state tax exemptions without obtaining federal tax-exempt status. If your nonprofit is already a 501(c)(3) organization, file California’s Form 3500A (“Submission of Exemption Request”) with the California Franchise Tax Board. If your nonprofit hasn’t qualified for federal tax-exempt status, file Form 3500 (“Exemption Application”) instead. For more information, visit our guide to California state tax exemptions.
Is A California Nonprofit Registered Agent Required?
Yes, your nonprofit corporation needs a California registered agent. You can do the job yourself, but we don’t recommend it. A registered agent is the person or business authorized to accept services of process (lawsuits) on behalf of your nonprofit, and a registered agent must be available every day during normal business hours at a physical location listed on your Articles of Incorporation. That’s a tough commitment, particularly if you need to hold meetings, travel to meet with potential donors, solicit contributions door to door, or otherwise manage and grow your nonprofit on a daily basis. Your registered agent’s physical California address also gets listed publicly on your nonprofit’s Articles of Incorporation. Put your own address down and you’ll receive loads of junk mail and have to deal with unwanted solicitors showing up at your door.
Northwest can help. When you sign up for our registered agent service, you can replace your physical California address with ours, and we’ll be the ones waiting day after day for services of process from the state. You get to keep your privacy, in other words, and you gain the freedom to manage your nonprofit how you want and where you want. And if we ever do receive legal notices on your behalf, we’ll scan them and send them to you on the day we receive them.Get Started
Do I Have To Register My Nonprofit As A Charity In California?
If your nonprofit intends to solicit and collect donations, hold property for charitable reasons, or in any way operate like a charity, you will need to register with the California Attorney General’s Registry of Charitable Trusts. The registration fee varies depending on the size and nature of your nonprofit, but you must register within 30 days after your nonprofit begins operation (including receiving any contributions of value). There is a $25 registration fee.
You’ll need to renew this charity registration with the CA Registry of Charitable Trusts by the 15th day of the 5th month after the end of your nonprofit’s accounting period. The renewal fees vary depending on your nonprofit’s gross annual revenue:
|Gross Annual Revenue||Fee|
|Less than $25,000||$0|
|$25,000 – $100,000||$25|
|$100,001 – $250,000||$50|
|$250,001 – $1 million||$75|
|$1,000,001 – $10 million||$150|
|$10,000,001 and $50 million||$225|
|More than $50 million||$30|
Do I Need A Tax ID Number (EIN) For A California Nonprofit?
A federal employer identification number (FEIN or EIN) is a must for any new nonprofit. You will need an EIN to apply for federal and/or state tax exemptions, to open a bank account in your nonprofit’s name, and more generally to navigate your nonprofit’s finances on a day to day basis.
After the State of California approves your nonprofit’s Articles of Incorporation, you can apply for an EIN online or by phone with the IRS. Or you can save yourself the time and trouble, add our convenient EIN service when you hire Northwest, and let us deal with the IRS.
Does A California Nonprofit Need A Business License?
Yes, your California nonprofit will need a business license, but licenses are issued by the city or county where your nonprofit is registered (not by the state). Fees and deadlines vary widely, and in some cities your nonprofit won’t have to pay the business license tax if you present proof of your nonprofit status (though you’ll typically still need the license itself).
Can I Register An Out Of State Nonprofit In California?
Yes, you can register an out of state nonprofit (called a “foreign nonprofit”) in California by filing the appropriate paperwork with the California Secretary of State. Visit our California foreign nonprofit page for more details.
Do I Have To Use The CA Forms For My Articles Of Incorporation?
No. You can write your own California nonprofit Articles of Incorporation, so long as your Articles satisfy the state’s requirements. This is particularly useful if you want to add additional provisions beyond what the state’s forms provide.
We also provide our own templates for writing California nonprofit Articles of Incorporation, free of charge:
California Nonprofit Articles of Incorporation Requirements
Your nonprofit’s name should be distinguishable from the names of other organizations on record with the California Secretary of State, and the name can’t suggest a purpose different from that described in your nonprofit Articles of Incorporation. You can mail a Name Availability Inquiry Letter to the Secretary of State’s office to find out if your nonprofit’s name is available, and you can reserve a name (for a $10 fee) for up to 60 days.
You’ll then need to list a physical address for your nonprofit corporation. If you hire Northwest, you may list our California street address in place of yours.
Service of Process
This section asks for the name and California street address of your nonprofit’s registered agent. This is the address where the state will deliver services of process (lawsuits and legal notifications) on behalf of your nonprofit. You can list yourself, a willing associate, or a registered agent service like Northwest. When you hire Northwest, you will list our California street address here.
The three distinct nonprofit Articles provided by the State of California (for public benefit, mutual benefit, and religious corporations) provide slightly different statements of purpose and different instructions. If your nonprofit is a mutual benefit or religious corporation, don’t alter the statement of purpose, as it appears on the form, in any way. If your nonprofit is a public benefit corporation, you’ll check a box identifying your general purpose as “public” and “charitable” and then write in a more specific statement of purpose.
This is another section where the Articles differ for mutual benefit, public benefit, and religious nonprofits in California. For mutual benefit corporations, you’re asked to provide a more specific statement of purpose (just a sentence), and the state provides the rest. If your nonprofit is a religious corporation or public benefit corporation, the state’s forms provides language recommended by the IRS for obtaining 501(c)(3) federal tax-exempt status.
Signature of Incorporator(s)
California asks for your Articles to be signed “by each incorporator,” but your incorporator does not need to be an officer, director, or member of your nonprofit. When you hire Northwest to form your nonprofit corporation, we will be your incorporator.