How to Start a Nonprofit in Pennsylvania (Step-by-Step)

Each state has specific requirements for starting and operating a nonprofit. 

In Pennsylvania, it’s crucial to be aware of the tax-exempt 501(c)(3) requirements. In addition to following the steps listed below and understanding tax laws surrounding nonprofits, you’ll also want to consider how meeting software, such as OnBoard, helps nonprofits operate efficiently while improving regulatory compliance. Read on to learn more about how to start a nonprofit in Pennsylvania.

1. Name Your Organization

The name of any business or nonprofit plays a critical role in its overall identity by members of the public. A well-chosen name conveys your nonprofit’s mission and values and also provides a lasting impression on potential supporters. Doctors Without Borders is a great example of a nonprofit name that exudes professionalism and compassion, while clearly stating their purpose.

2. Recruit a Board of Directors

A board of directors is a group of individuals responsible for guiding and overseeing the nonprofit’s activities. Boards typically consist of a chair/president, vice president, secretary, fundraising chair, community outreach chair, and other roles that suit its specific mission. Recruiting professionals with diverse backgrounds can help the nonprofit stay true to its mission, remain financially accountable, and enjoy good standing with its beneficiaries. A successful board of directors will contribute to the nonprofit’s long-term success and positive impact on the community.

3. File Articles of Incorporation

Every legal entity must file formal documents to establish its existence. These documents are called the articles of incorporation and provide key details, such as the organization’s name, purpose, location, board structure, and officers. They also serve as a contract between the nonprofit and the state that defines its legal structure. In Pennsylvania, articles of incorporation must be filed with the Bureau of Corporations and Charitable Organizations.

4. Obtain Employer Identification Number

An employer identification number (EIN) is a unique identifier for all businesses, similar to a social security number. It’s used for various purposes, such as for tax filing, opening business bank accounts, and managing payroll. An EIN is important for nonprofits since they’re tax-exempt and have specifications when complying with federal reporting requirements. Understanding section 501(c)(3) versus 501(c)(4) of the internal revenue code will give you better insight into how nonprofits operate.

5. Establish Governing Documents and Policies

As your nonprofit begins to take off, it’s important to create governing documents and policies to provide a clear framework for operations, ensure legal compliance, and form an organized structure. Board bylaws lay out these components, which include:

• Responsibilities and powers of directors
• Organizational purpose statement
• Board structure, including board positions and term limits
• Voting rules, including how many members must be available for voting to occur
• Amending bylaws procedures
• Conflict of interest policy
  
  

6. Apply for Pennsylvania Tax Exemptions

To attain tax exemptions in Pennsylvania, your nonprofit will have to submit Form REV-72 to the Department of Revenue. This form outlines the organization’s purpose, structure, financials, and other pertinent information that demonstrates its eligibility for tax-exempt status.