Are you considering starting a nonprofit organization in Iowa? Most nonprofits are formed for religious, charitable, scientific, literary, or educational purposes and are often eligible for federal and state tax exemptions.
In order to form a nonprofit corporation in Iowa, here are the steps you will need to take:
Determine who will be on the board of directors:
In Iowa, you are required to have one or more directors for your nonprofit organization.
Choose a name:
The name of your organization cannot be the same as the name of another nonprofit or other business already registered with the Iowa Secretary of State. Search the Business Entities Name Database to see if your chosen name is available.
Create and file your nonprofit articles of incorporation:
The Iowa Secretary of State’s office does not provide a sample or form for the articles of incorporation. Instead, the Secretary of State points you to the Iowa Nonprofit Corporation Act, which describes the requirements for what needs to be included. You will also need to include certain provision in your articles of incorporation to meet IRS requirements for tax-exempt status. Check out IRS Publication 557 for more information on Tax-Exempt Status for Your Organization. Next, you will receive a certificate of acknowledgement from the Iowa Secretary of State.
Bylaws for your nonprofit corporation will include the rules and procedures your corporation will follow for holding meetings, electing officers and directors, and taking care of other formalities. Your bylaws do not need to be filed with the Iowa Secretary of State, but they function as your organization’s operating manual.
Hold a meeting with your board of directors:
Once you have received a certificate of acknowledgement, hold an organizational meeting with the board of directors to adopt bylaws, appoint officers, and discuss other business. Make sure to record minutes from the meeting.
Set up a corporate records binder:
Your nonprofit will need a corporate records binder to hold important documents such as the articles of incorporation, bylaws, and meeting minutes.
Obtain federal and state tax exemptions:
In order to obtain federal tax-exempt status from the IRS, you will need to complete and file IRS Form 1023. Once you have established tax-exempt status with the IRS, you are automatically exempt from Iowa income tax. Your nonprofit may still be subject to other state taxes, so be sure to check with the Iowa Department of Revenue for more information.
In addition, here are some other great resources available to nonprofits in Iowa: