How To Start A Nonprofit In Tennessee
To start a nonprofit corporation in Tennessee, you must file a Nonprofit Corporation Charter with the Tennessee Secretary of State. You can file this document in person, by mail, or online. The Nonprofit Corporation Charter costs $100 to file. Once filed with the state, the charter officially creates your Tennessee nonprofit corporation, but truly preparing a nonprofit to pursue its mission requires several additional steps.
Starting a Tennessee Nonprofit Guide:
- Choose your TN nonprofit filing option
- File the TN Nonprofit Corporation Charter
- Get a Federal EIN from the IRS
- Adopt your nonprofit's bylaws
- Apply for federal and/or state tax exemptions
- Apply for any required state licenses
- Open a bank account for your TN nonprofit
- Submit the TN nonprofit annual report
Tennessee Nonprofit Filing Options
Free PDF Download
Download the Tennessee Nonprofit Corporation Charter. Fill out the form and submit to the state.
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TN Nonprofit Corporation Charter Requirements
To incorporate a Tennessee nonprofit, you must complete and file the Nonprofit Corporation Charter with the Tennessee Secretary of State. See the document below and click on any number to see what information is required in the corresponding section.
A Tennessee nonprofit’s name must be distinguishable from names of other organizations operating within the state. You can do a preliminary check for name availability by using the Business name Availability database on the Division of Business services website. It’s not a requirement that you check or reserve your name.
However, if your nonprofit wants to use a name that is not distinguishable from the name of an existing business, you can use the name if the other entity consents. If this situation applies to you, check the box and include the appropriate application to use an indistinguishable name, along with a separate $20 filing fee, with your nonprofit’s charter.
Include your nonprofit’s additional designation (if applicable). Additional designations include “Bank,” “Captive Insurance Company,” “Credit Union,” “Insurance Company,” “Litigation Financier,” “Neighborhood Preservation Nonprofit Corporation,” “School Support Organization,” and “Trust Company.”
Include the name and Tennessee street address (not just a PO Box) for your nonprofit’s registered agent. A registered agent is simply the individual or business entity appointed to receive legal notifications and other official state mail for your nonprofit. When you hire Northwest, our information goes here.
List the month that will serve as the close of your nonprofit’s fiscal year (December for most business entities), and whether or not your nonprofit will exist perpetually or dissolve on a specific date in the future. If you have a specific end date in mind, check “Other” and list the date in question.
For most nonprofits, the filing date (the date the state processes your charter) is the same as the effective date (the date of your organization’s official creation). However, Tennessee allows nonprofits to delay their effective dates up to 90 days after filing. If this applies to you, indicate the date and time of your nonprofit’s effective date.
Tennessee’s form contains the sentence descriptive of any qualifying nonprofit corporation: “The corporation is not for profit.” No action is required on this part of the form.
Complete the given checklist to properly identify your nonprofit as 1) a public benefit or mutual benefit corporation; 2) a religious or non-religious corporation; or 3) a member or non-member nonprofit.
Include the physical address of your nonprofit’s principal executive office (its principal place of business). When you hire Northwest, you can put our information here.
If your nonprofit’s mailing address differs from the address of its principal executive office, include that address here. Hire Northwest, and you can put our address here.
Include the names and addresses of each of your nonprofit’s incorporators (at least one). An incorporator is simply the individual or business entity that submits your nonprofit’s Nonprofit Corporation Charter and signs and dates the form. When you hire Northwest to form your nonprofit, we’ll be your incorporator.
If your nonprofit is a School Organization (see section 3 above), you’re required to complete this section. You’re asked to identify if your organization is exempt from the $100 filing fee, according to TN law, a “school support organization,” or an “educational institution.”
Describe how your nonprofit will distribute its assets if or when it shuts down (or “dissolves”). If your nonprofit intends to seek 501(c)(3) federal tax-exempt status, make sure your dissolution of assets provision uses the specific language required by the IRS.
Include any additional (not required) provisions you’d like to include for governing your nonprofit. If your nonprofit intends to seek 501(c)(3) tax-exempt status, you can use this section to include any required tax-exempt provisions that don’t already appear elsewhere in your Nonprofit Corporation Charter. To learn more, scroll down to Part 5 below.
How Much Does It Cost to Start a Tennessee Nonprofit?
Tennessee charges $100 to file the Nonprofit Corporation Charter, plus a 2.35% service fee if you file online and pay with a credit or debit card. When you hire Northwest to form your nonprofit, we file your documents online, and your total cost, which includes a full year of our registered agent service and the advice of our expert Corporate Guides, is $327.35.
How Long Does It Take to Start a Tennessee Nonprofit?
The standard processing time for printed/mailed filings is around 4-5 days. If you file online, you can speed this up to around 1-2 business days. The fastest method, however, is to deliver your charter document in person to Nashville and wait around a few hours for same-day filing. If you hire Northwest to start your nonprofit, we file online and typically have your Tennessee nonprofit formed in a day or less.
Does a Tennessee Nonprofit Need a Registered Agent?
Yes, Tennessee requires your nonprofit corporation to appoint a Tennessee registered agent. A registered agent is simply an individual or business entity that accepts service of process (legal notifications) and other state mail on your nonprofit’s behalf. You can do the job yourself, appoint an associate, or hire a registered agent service like Northwest.
Why hire a registered agent service? Mainly because the job of a registered agent, though it looks pretty simple on the surface, is an easier commitment to make than it is to keep. A registered agent must be available at a physical Tennessee address during normal business hours just in case a process server ever shows up with a legal notice, and that address gets listed publicly on your Nonprofit Corporation Charter. That’s not a problem if you don’t mind dealing with excessive junk mail, unwanted solicitors, and the need to be stuck at your desk all day. But if you want the freedom to manage and grow your nonprofit on your own terms, hiring a registered agent service can grant you the freedom you need.
When you hire Northwest, you can leave the endless waiting to us, help protect your privacy by listing our Tennessee address on your Nonprofit Corporate Charter, and take advantage of the infrastructure we’ve spent years building to assist our clients. If we ever do receive a service of process on your nonprofit’s behalf, we’ll scan it and send it to you on the day we receive it.
Get a Federal Employer Identification Number (EIN)
Your nonprofit will need a federal employer identification number (a FEIN or EIN) to conduct its daily business, open a bank account, and apply for federal 501(c)(3) tax-exempt status. Once the state approves your Nonprofit Corporation Charter, you can apply for an EIN at the IRS website, by fax, or by mail. Or you can hire Northwest to get your EIN for you. Just add our EIN service, for an additional $50 fee, at checkout.
Hold Your Organizational Meeting & Adopt Bylaws
Does My Tennessee Nonprofit Need Corporate Bylaws?
Yes. After Tennessee approves your Nonprofit Corporation Charter, your nonprofit should hold its organizational meeting—its first official meeting after incorporating. The object of an organizational meeting is to complete the incorporation process by electing/appointing directors and officers, adopting the nonprofit’s bylaws, and doing anything else necessary to get your nonprofit up and running.
Why Do Bylaws Matter?
Your nonprofit’s bylaws are basically the agreement it makes with itself. Without providing clear answers to important questions up front—the length of a director’s tenure, the responsibilities of the vice president, etc.—your nonprofit’s managers will struggle to guide the organization along a single, cohesive path. Even minor financial or ethical obstacles could end up bringing your organization’s daily operations to a halt.
It isn’t easy to write effective bylaws, but Northwest can help. We have years of experience working with the nonprofit sector, and we used that experience to create an adaptable template for writing nonprofit bylaws, as well as numerous other free nonprofit forms, to help get you started. Why? Because we want you to renew our registered agent service year after year, so we need your nonprofit to start successfully and stay successful.
Apply for Federal and/or State Tax Exemptions
Will My Tennessee Nonprofit Be Tax Exempt?
Unfortunately, incorporating as a nonprofit isn’t the same thing as obtaining tax-exempt status. To become a tax-exempt organization, your nonprofit will need to submit an Application for Recognition of Exemption to the IRS (Form 1023, 1023-EZ, or 1024). This is an expensive, sometimes lengthy process by which the IRS examines your nonprofit’s purpose, structure, history, and finances.
Currently, the IRS recognizes more than two dozen types of tax-exempt entities, but 501(c)(3) status for public charities and private foundations remains the most common. If your nonprofit decides to pursue this goal, make sure your Nonprofit Corporation Charter includes the specific tax-exempt language and provisions required by the IRS. Learn more at Northwest’s Guide to 501(c)(3) Tax-Exempt Status.
What About Tennessee State Tax Exemptions?
Tennessee nonprofits are automatically exempt from the state’s franchise and excise tax (hooray!). However, your nonprofit will need to apply to the Tennessee Department of Revenue for the Tennessee state sales tax exemption.
Obtain Tennessee State Licenses
Does a Tennessee Nonprofit Need a Business License?
Tennessee doesn’t require nonprofits to get a statewide, general business license, but most nonprofits will need to register with the TN Department of Revenue for state tax accounts. Most Tennessee counties (and some cities) also require a local business license. It’s best to simply contact your county clerk’s office to verify which licenses apply to your nonprofit.
Should My Nonprofit Register as a Tennessee Charity?
If your Tennessee nonprofit intends to solicit charitable contributions, it will likely need to register as a Tennessee charity with the TN Division of Charitable Solicitations. There are some exceptions (some religious and educational organizations, for instance, among others), but most organizations should expect to register and renew their registrations each year. The initial registration fee is $50. The annual renewal fee differs based on your nonprofit gross revenue.
Open a Bank Account For Your TN Nonprofit
To open a bank account for your Tennessee nonprofit, you will need to bring the following items with you to the bank:
- A copy of your Tennessee Nonprofit Corporation Charter
- A copy of your nonprofit’s bylaws
- Your Tennessee nonprofit’s EIN
It’s always wise to call the bank ahead of time and check its requirements. Some banks may require you to bring a resolution authorizing you to open a bank account in your nonprofit’s name (especially if your nonprofit has several directors and/or officers).
Submit the TN Nonprofit Annual Report
Your nonprofit will need to submit an annual report each year to the Tennessee Secretary of State updating (or confirming) its information on the state’s records. The report comes with a $20 filing fee (plus a 2.35% fee if you pay online with a credit or debit card). The report is due on the first day of the fourth month after your fiscal year ends (typically April 1st). There is an additional $20 fee if you need to change your registered agent.
If you’d rather not keep up with this report, its fee, and its deadline, however, you can add our convenient Tennessee Annual Report Compliance service, for an additional fee, when you hire Northwest.