with hyperlinks to the necessary documents and filing instructions;

where there is no hyperlink there is no prescribed form — consult a formbook or seek legal advice (SEE DISCLAIMER)

NOTE: SOME FORMS HAVE BEEN COPIED BY ME AND TURNED INTO FILLABLE FORMS; I RECOMMEND THAT YOU CHECK

THE OFFICIAL FORM ON THE APPLICABLE WEBSITE (DRS, IRS) TO MAKE SURE THE FORM IS CURRENT

( LAST UPDATED 1/24/15 ; PLEASE NOTIFY ME if you find BAD LINKS or errors)

BEFORE YOU START — SURE YOU WANT TO DO THIS? Click for a list of factors you may wish to consider

Step 1. INCORPORATION DOCUMENTS; Action by Incorporators. I ncorporators adopt a certificate of incorporation and bylaws, appoint directors and statutory agent for service. The incorporators may also appoint officers to serve until the directors’ meeting, although it is more common to have the directors do this at their first meeting, or by consent. NOTE: churches and other houses of worship typically incorporate as religious corporations using different and fewer documents .

Documents required for incorporators’ meeting:

. This should contain appropriate language to permit qualification as tax exempt (be sure to read IRS Publication 557 BEFORE submitting — not all purposes or activities qualify for exemption). and is signed by (1) incorporators and (2) a Connecticut resident as statutory agent for service, accepting appointment. You may file using the state form with attachments, or skip the state form if your document includes the same information as the state form requires. A Connecticut business address is also required. Remember that this document trumps your bylaws. In other states this may be known as the articles of incorporation. Click for a SAMPLE MANUSCRIPTED DOCUMENT in MS word, with hyperlinks to statutory sections. USE AT YOUR OWN RISK. YOU DO NOT NEED TO USE THE STATE FORM IF YOU USE A MANUSCRIPTED FORM CONTAINING AT LEAST EVERYTHING IN THE STATE FORM. But, if you use the state form, you MUST add at least the appropriate language and will probably want to add other things. (Don’t forget to include a succinct, yet flexible description of your organization’s purpose, overriding goals, motives, etc. Example: to assist individuals with mental illness and their families and friends, to advocate for their interests, and to educate the public concerning mental illness. In the form you’d put this sentence where I have put A, B and C.)

Minutes of the meeting (signed by duly appointed secretary of the meeting) OR unanimous written consent (signed by all incorporators) stating that bylaws have been adopted, directors elected, and any other actions taken. It is my view that incorporators may appoint initial officers rather than leaving this to the directors. Minutes and consents are kept with the corporation’s records.

Bylaws (preferably signed by incorporators). Make sure these are consistent with the certificate! Click for a SAMPLE MANUSCRIPTED DOCUMENT in MS word. USE AT YOUR OWN RISK. There is no state or official form, and bylaws are kept with the corporation’s records. Bylaws are NOT filed with the secretary of state.

Step 6. APPLY TO IRS FOR RECOGNITION OF EXEMPTION.

BIG CHANGES. IF THE ORGANIZATION EXPECTS TO HAVE LESS THAN $50,000 INCOME IN EACH OF THE NEXT 3 YEARS (AND HAS NOT HAD $50,000/YEAR INCOME IN ANY OF THE PAST 3), HAS ASSETS UNDER $250,000, AND IS NOT A CHURCH, SCHOOL, HOSPITAL OR CERTAIN OTHER SPECIFIED ORGANIZATIONS, IT IS ALL EXTREMELY SIMPLE AND YOU CAN DO IT YOURSELF.

THE SIMPLIFIED 1023 EZ PROCEDURE. (1) read the instructions here. (2) complete the eligibility checklist here. (3) register for an account on pay.gov. (4) IRS says: Enter 1023-EZ in the search box, AND (5) when the form comes up, fill it out (you can practice / review ahead of time by looking at a PDF of the form here), (6) Submit, paying $400 to pay.gov. Done. Instant exemption. More or less.

If you can’t do the EZ: File full-fledged IRS Form 1023 Application (signed by President or other authorized officer). Documents to prepare and file include 1023, 2848 (if represented by attorney or accountant) and 5768 (if making lobbying election). See below for details/fees.

Read the instructions first but also the cover sheet — the rules have changed but the form did not, so the cover sheet trumps the form. ALSO: you should read Rev. Proc 2013-9 which trumps Schedule E when it comes to organizations formed more than 27 months before filing 1023.

Consider using the IRS interactive Form 1023. You can’t submit it online, but you can fill it out.

Some tips on filling it out:

• There is a checklist. Fill it out! Do what it says!
• Be detailed!

Answer NO to the question about political activity!

Remember that you means the organization

Remember that will you means does the organization plan to or is it reasonably foreseeable that the organization will do it in the not-too-distant future, NOT could it ever happen?

For help understanding the public support requirements, read Remember Your Fractions .

FYI: the IRS has a list of sample follow-up questions for certain types of activities.

BE SURE YOU HAVE CHECKED the list on Office of Foreign Assets Control to make sure your organization includes no specially designated nationals or blocked persons who may be viewed as those who are or aid terrorists and make sure that any grant, etc. procedures address this issue.

1. If represented by a third party, generally an accountant or attorney, file Form 2848. It can be a good idea to fax this ahead. If you are in the northeast fax to 855-214-7519. If not check the 2848 instructions. P.S. IRS says fax numbers can change without notice; For updates, go to www.irs.gov/form2848 and search under “Recent Developments.”

If organization is making an election under section 501(h) to have its lobbying measured by a specific set of numerical guidelines, file

IRS Form 5768.

Fee. $850 for Form 1023, $400 for 1023EZ ($400 for Form 1023 if expect income to be $10,000 or less annually) Send a bank check or certified check to speed up handling. CHECK TO MAKE SURE YOU SEND TO THE CORRECT ADDRESS — the form itself has the wrong address.

Timing. usually must be filed within 27 months of incorporation in order for tax exemption to apply retroactively to incorporation date. (Exceptions apply for very small organizations and in limited circumstances — see instructions.) However, obtaining a determination with the standard Form 1023 submission used to take 3-6 months or more, although the IRS typically would acknowledge receipt and promise to respond in 100 days. At that point, the IRS may send a request for further information requiring response within a short period of time. If reply is not received, IRS may inactivate request. Application may be reactivated if requested within 90 days. You can contact the IRS by phone. but be prepared for a long wait.

IMPORTANT NOTE: EVEN IF YOU DONT HEAR FROM THE IRS, you still have to comply with the annual filings required for a recognized charitable organization. See the IRS page while you wait.

Step 7. REGISTER WITH CT DEPARTMENT OF REVENUE SERVICES.

Form. REG-1 . application for tax registration number. (You may be able to register on-line — but you will have to send the IRS letter separately so the old way may be just as good.) Phone number and social security numbers of 3 officers required. Must attach IRS letter (or explain that it is pending, and then follow up later with the IRS letter.) Read instructions here .

Fee. None, unless likely to engage in sales.

Timing issues. none. However: if you incorporate and then wait a while to file for exemption, this may become step 6 rather than step 7.

Step 8. ct SALES tax exemption is automatically available for payments made by organization’s check or credit card: use Form CERT-119 and attach the IRS exemption letter. For other exemptions, see the DRS page.

STEP 9. TOWN HALL: CT PROPERTY TAX EXEMPTION is important if the organization owns real estate or any significant TANGIBLE PERSONAL PROPERTY including office equipment, computers, etc. The organization must file Form M-3 or more recent version of M-3 or something similar ( check with LOCAL assessor to make sure this form is appropriate and current — towns can use different forms ) by November 1st of the year it owns property in the town where it would otherwise be subject to tax and then quadrennially (computed with 1965 as the first year: 2009 was the most recent quadrennial filing, then 2013, and so on.) In many towns, the property will not be exempt until the tax year following the filing. THe

STEP 10. KEEP IN GOOD STANDING AND RETAIN EXEMPTION. See the accompanying COMPLIANCE LIST . In particular: the IRS will monitor filings of Form 990 / 990-EZ to see whether you continue to qualify as a public charity. This is determined using a rolling average of your sources of support over five years, the current year and four prior years, as reported on the 990. This gets confusing, so read Remember Your Fractions . If you fail the test, the 501(c)(3) exemption is unaffected, but status as a private foundation may cause additional filing requirements and the imposition of an excise tax on net investment income, plus a fine of up to $20 / day for failure to file the informational return required of private foundations, Form 990-PF. Therefore, it is very important to follow up. If not required to file 990 or 990-EZ you must file the 990N — failure to file for three years = los of exemption.

Need help? If you are unable to afford an attorney (fees usually run $2,000 to $5,000+) you may be eligible for assistance from Yale Law School students at the Yale Law School Nonprofit Organization Law Clinic. If you are an organization with a large budget and a big problem but no money for legal fees, contact the Pro Bono Partnership. You may also be able to obtain help from an accountant volunteer with Community Accounting Aid & Services, Inc. (sponsored by the CT Society of Certified Public Accountants).

DISCLAIMER.

THIS INFORMATION IS NOT PROVIDED AS LEGAL ADVICE AND CREATES NO ATTORNEY-CLIENT RELATIONSHIP.

PLEASE CONSULT YOUR OWN LEGAL AND FINANCIAL ADVISORS.