The California Corporations Code Section 5000 allows residents to form domestic nonprofit corporations if the primary purpose of the businesses is charitable, for public good or for religious reasons. California nonprofit corporations can receive an exemption from federal and state taxes. The Internal Revenue Code Section 501(c)(3) governs the federal tax requirements for charities and nonprofit organizations. In addition to registering a nonprofit corporation with the California secretary of state and the California Franchise Tax Board, Californians also must register their businesses as nonprofit organizations with the Internal Revenue Service pursuant to Section 501(c)(3).
Items you will need
- Filing fees
- Articles of incorporation
Download and complete the California Articles of Incorporation -- Nonprofit Mutual Benefit, Public Benefit or Religious from the California secretary of state's website. (See Resources).
Appoint a board of directors and a registered agent on your nonprofit corporation's behalf who will be authorized to accept legal service. A corporation cannot legally be its own registered agent, and the secretary of state does not allow other businesses to act as registered agents.
Select a name for the corporation and its purpose. Under California law, an acknowledgment certifying the purpose of the nonprofit corporation's mission or purpose must be signed by the incorporator.
Sign the articles of incorporation. If you are not the sole incorporator, all other incorporators also must sign the articles.
Obtain signatures from the initial board of directors.
Obtain a money order, certified check or personal check for $30. The filing fee for nonprofit corporations is $30, current as of 2011.
File the articles of incorporation with the California secretary of state and attach the $30 filing fee. Articles of incorporation also may be filed to the California secretary of state's Sacramento office. (See Resources).
Under California law, California nonprofit corporations are subject to a minimum $800 state business tax annually unless it receives an exemption from the California Franchise Tax Board as a tax-exempt nonprofit corporation. Until a corporation receives a formal exemption, it must file and pay its annual taxes. In most cases, the California Franchise Tax Board requires that a nonprofit corporation receive a tax exemption from the IRS before it will provide an exemption from state taxes.
The information in this article should be used for general guidance. For specific assistance, seek the advice of a licensed attorney in California or contact the California State Bar Association for information on the attorney referral service.