Obtaining 501(c)(3) Non-Profit Status

Articles of Incorporation

You have your name and have a board selected. Now it's time to get incorporated.

Articles of Incorporation are the primary rules governing the management of a corporation or organization in the United States. The articles are written in legal language that can sound quite intimidating. Don’t let words scare you away.

You will submit your Articles of Incorporation when you incorporate as a nonprofit entity in your state. The IRS will also request that you include your Articles of Incorporation when you file for federal 501(c)(3) status.

The process of writing your Articles of Incorporation will help you define the mission and structure of your organization.

Each state has its own procedure and form that your organization will need to file to incorporate. The forms for each state will vary widely. On the IRS Web site, there is a list of each state’s incorporation information at http://www.irs.gov/charities/article/0,,id=167760,00.html. You can also locate your state form by contacting your Department of State, Division of Corporations. An Internet search for "your state name” and "incorporation” is a good start. Your state will grant a charter (or similar terminology) once your application has been approved. Your charter is a document that proclaims that your organization is now a corporation and defines your privileges and purposes.

What all states have in common is the requirement that you include your "Articles of Incorporation,” "Certificate of Incorporation” or "Corporate Charter.” These are all different names for the same thing.

A good way to start is to contact other shelters and rescue organizations in your state and ask if they would share their Articles of Incorporation or even their original 501(c)(3) application with you. You can also run a search on the Internet for "Articles of Incorporation” and other key words like "humane society” or "SPCA.” Seeing what others with a similar mission have set down in writing will help you compose your own articles.

However, don’t just copy another group! Your articles are a legal document, and it is very important that you include your own organization’s actual purpose.

While each state’s requirements may vary, the Articles of Incorporation will generally include

1. Your corporation’s name
2. The names of the persons organizing your corporation
3. A statement that your organization is incorporating as a nonprofit corporation
4. Whether your corporation will be permanent or limited in duration
5. The initial director(s) of the corporation
6. The location of the corporation's office

1. Your corporation’s name should be different from any other corporation in your area. Certain words, such as "incorporated," "limited," "corporation," or their abbreviations, may be required by your state to indicate to people that your group is a corporation (with limited liability) as opposed to an individual or partnership (with unlimited liability).
2. The persons organizing your corporation would usually be you or your board of directors.
3. You will need to clearly state that your organization is incorporating as a non-stock nonprofit corporation.
4. You will need to indicate whether your corporation will be permanent or limited for a specific period of time. For example, if you are creating a group that is dealing with the impact of a single hurricane in a single region and you plan to dissolve the organization once this effort is complete, your corporation will be limited. Generally most organizations are permanent.

In some cases, a corporation must state the purposes for which it is formed. Some jurisdictions permit a general statement such as "any lawful purpose," but some require explicit specifications concerning your activity as a charitable animal shelter or rescue group.

If you plan to seek 501(c)(3) tax-exempt status with the Internal Revenue Service, certain specific wording must be included, stating no part of the assets of the corporation are to benefit the members. (Sample 3 from the IRS Web site is included below).

5. You will need to list the initial director(s) of the corporation.
6. Include the location of the corporation's "registered office.” This must be a physical location where legal papers can be served if necessary.

Each state’s requirements will be different. Some states may provide you with a simple form to complete. Other states may ask for more involved information. The samples that follow are Articles of Incorporations submitted by actual organizations to their states. They are provided for illustrative purposes only.

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Sample 1. Articles of Incorporation for a Rescue Group for state incorporation

Article I : The name of the corporation is ABC Animal Refuge.

Article II: The duration of the corporation is perpetual.

Article III: The corporation has been organized for charitable, humane and educational purposes, including providing refuge for stray, abandoned, lost or injured animals, to place adoptable pets in permanent homes, to educate the public about animal welfare, to make funds available to pet owners and caretakers to have their pets spayed or neutered, and to promote awareness of the mission of Sunset Farm Animal Refuge.

Article IV: The corporation has no members. (Note: a corporation may also have members. In that case the manner of election or appointment and the rights of the members will be included.)

Article V: The corporation shall not have the authority to issue any capital stock.

Article VI: The street address of the registered office is 1234 Any Street, Any Town, Any State, 12345, and the name of the registered agent at that office is Deborah Director.

Article VII: The names and addresses of the Directors are

Deborah Director, 1234 Any Street, Any Town, Any State, 12345
David Person, 543 Any Street, Any Town, Any State, 12345
Jane Doe, 765 Any Street, Any Town, Any State, 12345

Article VIII: The name and address of the incorporator is Deborah Director, 1234 Any Street, Any Town, Any State, 12345.

Sample 2. Articles of Incorporation for a
Trap-Neuter-Return Group for state of MA incorporation

Article I: The name of the corporation is ABC Feline Rescue.

Article II: The purpose of the corporation is to engage in the following activities:

1. To aid in humanely reducing the number of feral cats in the area to be serviced by the corporation, and further to aid in the humane treatment of those cats remaining by providing shelter, sustenance, veterinary examination, inoculation, spaying/neutering and the adoption of such cats as pets by individuals in the community whenever possible;
2. To provide for the raising of funds through public and private donations in order to further the purpose of the corporation;
3. For any other lawful, civic, educational, charitable or benevolent purpose

Article III: The corporation has one or more classes of members, the designation of such classes, the manner of election or appointments, the duration of membership and the qualification and rights, including voting rights, of the members of each class, may be set forth in the by-laws of the corporation or may be set forth below

1. Set forth in By-Laws

Article IV: other lawful provisions, if any, for the conduct and regulation of the business and affairs of the corporation, for its voluntary dissolution, or for limiting, defining, or regulating the powers of the corporation, or of its directors or members, or of any class of members, are as follows:

The corporation shall indemnify each of its directors, officers, employees and other agents (including persons who serve at its request as directors, officers, employees or other agents of another organization in which it has an interest) against all liabilities and expenses, including amounts paid in satisfaction of judgments, in compromise or as fines and penalties, and counsel fees reasonably incurred by him in connection with the defense or disposition of any action, suit or other proceeding, whether civil or criminal, in which he may be involve or with reason of his being or having been such a director, officer, employee or agent, except with respect to any matter as to which he shall have been adjudicated in any proceeding not to have acted in good faith in the reasonable belief that his action was in the best interests of the corporation; provided, however, that as to any matter disposed of by a compromise payment by such director, officer, employee or agent, pursuant to a consent decree or otherwise, no indemnification either for said payment or for any other expenses shall be provided unless such compromise shall be approved as in the best interests of the corporation, after notice that it involves such indemnification.

1. By a disinterested majority of the directors then in office; or
2. By a majority of the disinterested directors then in office, provided that there has been obtained an opinion in writing of independent legal counsel to the effect that such director, officer, employee or agent appears to have acted in good faith in the reasonable belief that his action was in the best interests of the corporation.

Expenses including counsel fees, reasonably incurred by any such director, officer, trustee, employee or agent in connection with the defense or disposition of any such action, suit or other proceeding may be paid from time to time by the corporation in advance of the final disposition thereof upon receipt of an undertaking by such individual to repay the amounts so paid to the corporation if he shall be adjudicated to be not entitled to indemnification under Massachusetts General Laws, Chapter 180, Section 6. The right of indemnification hereby provided shall not be exclusive of or affect any other rights to which any director, officer, employee or agent may be entitled. Nothing contained herein shall affect any rights to indemnification to which corporate personnel may be entitled by contract or otherwise under law. As used in this paragraph, the terms "directors”, "officer”, "employee” and "agent” include their respective heirs, executors and administrators and an "interested” director is one against whom in such capacity the proceedings in question or another proceeding on the same or similar grounds is then pending.

Upon the liquidation or dissolution of the corporation, after payment of all of the liabilities of the corporation or due provision thereof, all of the remaining assets of the corporation shall be distributed to one or more organizations exempt from Federal income tax under the Internal Revenue code, in a manner consistent with the procedures for dissolution set forth under Massachusetts B.L. c.180 S11A (*Dissolution of Corporation Constituting Public Charity).

Sample 3. Articles of Incorporation Provided by the Internal Revenue Service

Articles of Incorporation of the undersigned, a majority of whom are citizens of the United States, desiring to form a Non-Profit Corporation under the Non-Profit Corporation Law of (your state), do hereby certify:

First: The name of the Corporation shall be (name of your organization)

Second: The place in this state where the principal office of the Corporation is to be located is the City of (your city), County (your county).

Third: Said corporation is organized exclusively for charitable, religious, educational, and scientific purposes, including, for such purposes, the making of distributions to organizations that qualify as exempt organizations under section 501(c)(3) of the Internal Revenue Code, or the corresponding section of any future federal tax code.

Fourth: The names and addresses of the persons who are the initial trustees of the corporation are as follows:

(You will list the names and addresses of your directors here)

Fifth: No part of the net earnings of the corporation shall inure to the benefit of, or be distributable to its members, trustees, officers, or other private persons, except that the corporation shall be authorized and empowered to pay reasonable compensation for services rendered and to make payments and distributions in furtherance of the purposes set forth in Article Third hereof. No substantial part of the activities of the corporation shall be the carrying on of propaganda, or otherwise attempting to influence legislation, and the corporation shall not participate in, or intervene in (including the publishing or distribution of statements) any political campaign on behalf of or in opposition to any candidate for public office. Notwithstanding any other provision of these articles, the corporation shall not carry on any other activities not permitted to be carried on (a) by a corporation exempt from federal income tax under section 501(c)(3) of the Internal Revenue Code, or the corresponding section of any future federal tax code, or (b) by a corporation, contributions to which are deductible under section 170(c)(2) of the Internal Revenue Code, or the corresponding section of any future federal tax code.

If reference to federal law in articles of incorporation imposes a limitation that is invalid in your state, you may wish to substitute the following for the last sentence of the preceding paragraph: "Notwithstanding any other provision of these articles, this corporation shall not, except to an insubstantial degree, engage in any activities or exercise any powers that are not in furtherance of the purposes of this corporation.”

Sixth: Upon the dissolution of the corporation, assets shall be distributed for one or more exempt purposes within the meaning of section 501(c)(3) of the Internal Revenue Code, or the corresponding section of any future federal tax code, or shall be distributed to the federal government, or to a state or local government, for a public purpose. Any such assets not so disposed of shall be disposed of by a Court of Competent Jurisdiction of the county in which the principal office of the corporation is then located, exclusively for such purposes or to such organization or organizations, as said Court shall determine, which are organized and operated exclusively for such purposes.

In witness whereof, we have hereunto subscribed our names this (number) day of (month/year):

You will include the names and signatures of directors.

This and other examples are included on the IRS site at http://www.irs.gov/charities/charitable/article/0,,id=122728,00.html

Again, you can find a link to your state’s incorporation requirements on the IRS site at http://www.irs.gov/charities/article/0,,id=167760,00.html.

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Approach the composition of your Articles of Incorporation as an opportunity to clearly define the structure of your organization. Your finished document will present your organization and your mission clearly to your community and help guide you in the future.