Nonprofit Formation Checklist

# Nonprofit Formation Checklist

Turns what the founders have told the firm into an ordered formation checklist the attorney can work from, with each step's status, owner, and what's still needed from the client.

## What to ask for
- Founder intake notes or questionnaire: proposed name, mission and planned activities, state of formation, where it will operate and raise money, founders and proposed directors and officers.
- Whether it's a new entity or a conversion of an existing program, fiscally sponsored project, or for-profit.
- Expected funding sources (individual donors, grants, government contracts, events, earned income) and rough first-years budget if known.
- Anything already done: name reservation, filed articles, EIN, bank account, website, donations already received.
- If something isn't in the material, build the checklist and mark each gap as [MISSING: ...].

## How to work
1. **Purpose and exemption category.** Record the mission and activities in the founders' words. Note the exemption category the founders expect (charitable, educational, religious, social welfare, trade association, other) as "attorney to confirm". Flag activities that need attorney attention: lobbying or political activity, grants to individuals or foreign organizations, programs benefiting founders or their families, earned-income businesses, scholarships, housing, health care, schools.
2. **Name.** Availability in the formation state and any foreign-qualification states; domain and trademark check if the founders care about the brand.
3. **Incorporation.** Formation state; nonprofit corporation (or other form the attorney picks); articles with the purpose and dissolution language the exemption path requires (to verify); registered agent; incorporator; members or no members.
4. **Bylaws.** Board size, terms, quorum, voting, officers, committees, meetings and notice, indemnification, amendment process, member provisions if any.
5. **Board and officers.** Proposed directors and officers with roles. Flag a board of fewer than the number the state or reviewers expect, family members or business partners making up a majority, paid directors, or the founder holding every officer role. Facts only; the attorney advises on governance.
6. **Core policies.** Conflict-of-interest policy (with annual disclosure statements), compensation approval process, whistleblower and document retention policies, gift acceptance, expense reimbursement. Mark which the attorney wants adopted at the organizational meeting.
7. **Organizational meeting.** Adopt bylaws and policies, elect officers, authorize EIN, bank account, exemption application, and fiscal year; minutes signed.
8. **EIN and banking.** Apply for the EIN after formation; open a bank account in the entity's name; no commingling with founders' funds.
9. **Federal tax exemption.** Note the likely application path for the attorney to confirm (which form version, streamlined eligibility if any, user fee, timing to preserve exemption back to formation); all to verify. List what the application needs: narrative of activities, budgets for the required years, governing documents, compensation information, related-party facts.
10. **State tax exemptions.** State income or franchise tax exemption, sales and property tax exemption where available; to verify by state.
11. **Charitable solicitation registration.** Registration before soliciting in each state where the organization will ask for donations (including online solicitation, to verify); state attorney general or secretary of state registry; annual renewals.
12. **Other registrations.** Local business license, employer registrations if hiring, raffle or gaming permits for events, foreign qualification in states where it will operate.
13. **Post-formation calendar hand-off.** Note the recurring filings to put on the annual calendar (information return, state annual report, solicitation renewals).

## Output

**Nonprofit Formation Checklist: [Proposed name]**  State: [ ]  Prepared: [date]

1. **Snapshot** (3-4 lines): mission, state, expected exemption category (to confirm), where it will raise money.
2. **Issues for the attorney** (bullets, most important first; "None noted" if none)
3. **Checklist** table: # | Step | What's involved | Needed from client | Owner | Status | Notes
4. **Proposed board and officers** table: Name | Role | Relationship to founders | Compensated? | Notes
5. **Solicitation states** table: State | Activity there | Registration needed? (to verify) | Status
6. **Questions to ask the founders** (numbered, from the [MISSING] items)
7. **To verify** (state formation requirements and fees, required articles language, exemption application form and fee, filing timing, state exemptions, solicitation registration thresholds and exemptions by state)

## Rules
- Draft for attorney review; not legal or tax advice.
- Filing fees, application forms, timing rules and registration thresholds vary by state and change: list them under "To verify", never state them as final.
- Never invent founders, directors, budgets or dates. Unknown = [MISSING].
- Don't state that the organization qualifies for exemption or any category. The attorney decides.
- Flag any donations already accepted or promises made to donors about deductibility for the attorney.