A lot of individuals who want to make a difference choose to form a nonprofit organization. Whether it is to support a cause you are passionate about or you are looking for a sustainable manner of helping a certain community in Connecticut, you will have to understand the Connecticut business filing process and requirements of the state.
The first thing you need to do is to determine if there is an unaddressed need in the community. You should also check if there are no other existing organizations already serving the cause that you have chosen. Make sure the decisions that you make will help create an impact on the community and allow you to maximize existing resources.
If the organization has a place in the community after careful evaluation, then you must take the necessary steps to form it. One of the things you need to familiarize yourself with is the Connecticut business filing process.
Many nonprofit organizations qualify for the 501(c)(3) status. What does this mean?
Generally, certain types of nonprofits can enjoy state and federal tax exemptions under the 501(c)(3) law. It applies to your organization if you form it for charitable, educational, literary, religious, or scientific purposes.
You will have to form your organization first following the rules of Connecticut. Once you successfully create the entity, apply for the said status with the Internal Revenue Service (IRS).
Going through the Process
The Connecticut business filing process is also applicable to nonprofit corporations. So, you will have to submit formal paperwork, pay corresponding fees, and ensure compliance to state obligations.
Naming your Organization
The first step you need to complete is to choose an appropriate name for your entity. Aside from coming up with something that people can easily recall, you should also make sure that it follows the naming guidelines in the state.
Your desired name should be distinguishable. That means you cannot use a name taken by another entity registered with the state. Conduct a name search on the database of the Secretary of State found on their website. You should also include a proper designator. You can use Corporation, Incorporated, Company, or any of their abbreviations.
Appointing a Registered Agent
The state also requires all nonprofits operating in Connecticut to have a registered agent. They will be accepting legal correspondence on behalf of your organization. You can nominate either an individual or a business entity.
If you choose an individual, they have to be a resident of Connecticut and at least 18 years old. They should also provide a complete street address in the state and have to be available in that address during normal business hours. Meanwhile, if you select a third-party company like DoMyLLC, make sure they are authorized to transact in the state. You cannot elect your own organization as a registered agent.
Choosing your Organization’s Initial Directors and Officers
Your organization needs a board of directors. The members of this board are in charge of overseeing the nonprofit corporation’s operations. There should be at least three directors who are not related to one another. The entity will also need to have officers, including a president and a secretary.
Preparing and Filing Formal Paperwork
To formally register your nonprofit corporation, submit a Nonstock Certificate of Incorporation to the Secretary of State. The filing fee for this is $50. If you want the one-day expedited processing service, you will have to pay an additional $50.
When filling out the form, you will have to disclose the following information:
- Name of the Corporation – Follow the naming guidelines.
- Members – State whether your nonprofit corporation will have members and if they are entitled to vote. If you plan on having more than one class of members, attach a document showing the designation of each class.
- Registered Agent Information – You have to inform the state of the name and address of the registered agent that you have appointed.
- Purpose – Connecticut allows you to put a short and general description of the purpose of your organization. But, if you are planning on applying for the 501(c)(3) status, you will need to use the tax-exempt language that the IRS requires. Check this with the IRS.
- Corporate Email – The Secretary of State sends annual report reminders. So, they will need your corporation’s email address.
- Execution – You will need the name, address, and signature of the incorporator of your organization.
NonProfit organizations need to create bylaws. They contain the procedures and rules that will govern your corporation, including those that you will have to follow when holding meetings, electing directors and officers, and taking care of corporate formalities that the state requires.
Holding an Initial Meeting of Board of Directors
The initial board meeting of an organization is often referred to as the organizational meeting. During this, the members of the board of directors have to complete the following tasks:
- Approve the Bylaws of the Organization
- Appoint Officers
- Set an Accounting Period
- Set a Tax Year
- Approve the Initial Transactions of the Organization
Make sure to record the minutes of the meeting.
Getting an Employer Identification Number (EIN)
Your nonprofit needs to obtain an EIN from the IRS. It is like a social security number that will identify your corporation. You will need it for tax purposes, hiring employees, and opening a corporate bank account. Applying for an EIN is free of charge.
Obtaining Other Business Licenses
Connecticut does not have a state business license. However, you may need to obtain certain licenses depending on your location. Check this with your local government.
Filing the Annual Report
As a nonprofit operating in Connecticut, you have the obligation to maintain a good standing status with the state. So, you need to file an initial report 30 days after the formation of your corporation. After that, you will have to submit annual reports to the Secretary of State on or before the last date of your anniversary month. The filing fee for this report is $50.
Obtaining Tax Exemptions
Once you successfully finish the Connecticut business filing process, you can finally apply for tax exemptions.
For federal tax exemption, you will have to file a completed Application for Recognition of Exemption Under Section 501(c)(3) of the Internal Revenue Code (Form 1023). If you have a small nonprofit, you may choose to use the Streamlined Application for Recognition of Exemption Under Section 501(c)(3) of the Internal Revenue Code (Form 1023-EZ).
As for tax exemption at the state level, you will have to apply with the Department of Revenue Services. Depending on the activities of your organization, you may also need to register with the Attorney General. That is especially necessary if you plan on doing fundraising activities.
Getting Expert Help With Connecticut Business Filing
Launching a nonprofit organization is an exciting endeavor. It allows you to pursue a cause that you are passionate about and extend a helping hand to the community that you care for. That makes it a rewarding experience.
If you are 100% sure that forming a nonprofit organization in Connecticut is right for you, you will have to go through the proper registration process. Doing this will prevent any possible fines and legal issues. It may also help you gain access to grants and qualify for tax exemptions. Additionally, it will also provide protection of your personal assets.
The whole ordeal can be a bit overwhelming for some people. If you are unsure whether you can handle the processes and comply with all state requirements, then it may be best to get help from a reliable third-party organization like DoMyLLC.
With our team of experts on your side, you can ensure compliance. We can handle the preparation and filing of the necessary paperwork. You can also appoint us as your registered agent. Additionally, we offer personalized solutions. With this, you can expect a service that is suitable for your circumstances and needs.
Our live support feature allows you to get answers to your queries and concerns as soon as possible. If you want to learn more about our services and find out how you can benefit from them, contact us.
Business Filing Section