How Do You Start a Nonprofit Organization?


Quick Answer

To start a nonprofit organization, create a detailed business plan, do market research, and incorporate in order to receive tax-exempt status, recommends the U.S. Small Business Administration. Don't forget to apply for local and federal tax exemptions.

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Full Answer

A good place to start when creating a nonprofit organization is to do market research, says the U.S. Small Business Administration. Be sure the nonprofit is unique compared to others within the same niche market. This shows market need and can ensure your organization is successful.

After completing market research, start working on the business plan, recommends the U.S. Small Business Administration. A nonprofit is a type of business, so when writing a business plan, it should be similar to any other type of company being started. This includes determining how to get funding, knowing how to market the nonprofit, and figuring out board members and volunteers.

Nonprofits are often incorporated and require additional paperwork, according to the U.S. Small Business Administration. Many nonprofits have 501(c)(3) tax-exempt status. The process of applying for incorporation is similar to other corporations, though you are also asking for tax-exempt status. Incorporating involves picking a business name, filing the paperwork, and applying for the non-profit state and federal tax exemptions. You also need to create corporate bylines and begin fundraising.

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