How to Start a Nonprofit in Ohio

1. Name Your Organization

   Your organization’s name establishes its brand and is also important for incorporating with the state. The legal name of your nonprofit corporation may not conflict with any other organization registered in the state. Make sure the name is available and meets state requirements.

   Name Search:	Ohio Secretary of State Name search
   Suffix:	Not required.  Ohio Revised Code §1702

2. Recruit Incorporators and Initial Directors

   The incorporator is the person who signs the Articles of Incorporation for your nonprofit. You will need at least one, but can have more than one. Directors make up the governing body of your nonprofit corporation and are stakeholders in your organization’s purpose and success. You’ll want to identify three, unrelated individuals to meet IRS requirements. You will also want to be aware of any age or residency requirements.

   Ohio director requirements:	Number: minimum 3 Qualifications: None. No residency requirement. No membership requirement. Term: until successor is elected Quorum: majority Committee: minimum 1 director
   Ohio officer requirements:	A president, a secretary, and a treasurer are required. Qualifications: Need not be a director. Two or more offices may be held by the same individual.

3. Appoint a Registered Agent

   A registered agent is responsible for receiving legal notices on behalf of your organization. The appointed registered agent must be physically located in the state and maintain an office that is open during regular business hours. As a nationwide registered agent, our service is designed to receive your legal documents and provide secure access to those documents through your online account. Our local Ohio registered agent office is located in North Canton, OH. We offer registered agent service independently or as part of our nonprofit formation packages.

4. Prepare and File Articles of Incorporation

   Your nonprofit’s articles of incorporation officially mark the creation of your organization. They document where and when the organization was formed and capture other information necessary to verify its existence. While requirements for language vary from state-to-state, there are some basic provisions that the IRS will look for when you apply for 501(c)(3) exemption. It is important to customize the articles for your organization and make sure you meet the state and IRS requirements. Meeting these requirements from the start will help avoid having to make amendments later or risk getting your 501(c)(3) application rejected. Some states will also require you to publish your articles of incorporation, so be mindful of any deadlines and publishing instructions.

   Agency:	Ohio Secretary of State
   Form:	532B: Initial Articles of Incorporation
   Filing Method:	Mail or online.
   Agency Fee:	$99
   Turnaround:	~3-7 business days for mail.
   Law:	Ohio Revised Code - Chapter 1702: Nonprofit Corporation Law
   Notes:	The registered agent must sign.

5. File Initial Report

   After filing articles of incorporation, you must file an initial report.

   Not required

   
   
   

6. Obtain an Employer Identification Number (EIN)

   This unique, nine-digit number is assigned by the IRS to identify your nonprofit. All types of nonprofits will apply for an EIN, not only those that hire employees. You will use your EIN to open a bank account, apply for 501(c)(3) status, and submit 990 returns to the IRS.

   Agency:	Internal Revenue Service (IRS)
   Form:	IRS Form SS-4
   Instructions:	Applying for an EIN without a SSN/TIN: Online applications are not accepted if an individual does not have a SSN/TIN. Form SS-4 must be completed, signed, and faxed to the IRS, leaving the SSN/TIN field blank or adding the terminology "foreign" to that line item. To follow up on the application, call the IRS and ensure they received the application.  Depending on the agent you speak with, you may be able to obtain the EIN over the phone. The IRS may then fax the EIN documentation back to you.
   Filing Method:	Mail, phone, fax, or online.
   IRS fee:	$0
   Turnaround:	Immediately online or by phone. 4 business days by fax. 4-5 weeks by mail.
   Notes:	The IRS website is only available during certain hours. Print your EIN before closing your session. For additional guidance, see IRS Pub 1635: Understanding Your EIN.

7. Store Nonprofit Records

   As you launch your nonprofit, you will receive a number of official documents. Organizing these documents in one place will save you headaches down the road. You will soon have numerous items to keep in your records including your EIN letter, bylaws, meeting minutes, 501(c)(3) determination letter, and more.

   
   
   

   A great way to maintain necessary documentation is Records Manager, our software for storing records securely, tracking directors and officers, and getting notified of meetings.

8. Establish Initial Governing Documents and Policies

   Your bylaws are the governing document for your nonprofit. They serve as your organization’s operating manual and should be consistent with your articles of incorporation and the law. When your Board of Directors meets for the first time, you’ll review and ratify the bylaws and they will be a roadmap for governance from there.

   At the same time, you’ll also want to create and adopt a conflict of interest policy. A conflict of interest is when someone in a key position in your nonprofit has competing interests and is making choices that could benefit themselves to the harm of the organization. Personal interests should be set aside and organizational interests prioritized. If a conflict of interest does arise, it should be disclosed immediately.

   Your application to the IRS for 501(c)(3) exemption will require that both the bylaws and the conflict of interest policy are approved and adopted. Once they’ve been adopted, safely store them in your Nonprofit Records Kit.

9. Hold Organizational Meeting of the Board of Directors

   The initial organizational meeting of your Board of Directors will be incredibly productive. At this meeting you will approve the bylaws, adopt the conflict of interest policy, elect directors, appoint officers, and approve resolutions such as opening the organization’s bank account. Important decisions are being made so be sure to record them in the meeting minutes.

10. Get Ohio State Tax Identification Numbers/Accounts

    All business taxpayers must be registered with the Ohio Department of Taxation. You can register online for commercial activity tax (CAT), sales tax, employer withholding, unemployment compensation, workers' compensation, and municipal income taxes for nearly 500 cities and villages.

    Submit to:	Ohio Department of Taxation http://www.tax.ohio.gov/
    Filing:	Online using Ohio Business Gateway or by phone (888) 405-4089
    Fee:	$0

11. Apply for 501(c)

    Applying for 501(c) tax exemption can feel like the most daunting step in bringing your nonprofit dream into reality, but obtaining tax exemption comes with many benefits. You will be able to apply for grants and grow your fundraising success in addition to being exempt from IRS income tax. 501(c) is the chapter of the Internal Revenue Code that regulates nonprofit organizations. Like others, you may be most familiar with 501(c)(3) nonprofits, including charities and foundations. 501(c)(3) nonprofits apply using Form 1023 or Form 1023-EZ. Review the criteria for each application and make sure you meet the eligibility requirements set out by the IRS. Other types of nonprofits, including 501(c)(4)s and 501(c)(6)s, apply using Form 1024. After reviewing and approving your application, the IRS will return a Determination Letter officially recognizing your exemption.

    Completing the federal application for tax exemption is significantly easier with the assistance and support of a professional. Find someone with the expertise to ensure the correct application is being used and is completed accurately. A well-prepared application takes time, over 100 hours by IRS estimates, so put yourself on the path to success by finding a specialist to walk alongside you in the journey - from start to tax-exempt finish!

    Agency:	Internal Revenue Service (IRS)
    Form:	IRS Form 1023, IRS Form 1023-EZ, or IRS Form 1024
    Instructions:	IRS Instructions for Form 1023, IRS Instructions for Form 1023-EZ, or IRS Instructions for Form 1024.  Also see guidance IRS Pub 557: Tax-Exempt Status for Your Organization.
    Filing Method:	Mail
    Agency Fee:	$275 for organizations filing Form 1023-EZ and $600 for organizations filing Form 1023.
    Turnaround:	1023-EZ average: <1 month. 1023 average: 3-6 months.

    

12. Report Beneficial Ownership Information to FinCEN

    As of January 1, 2024, millions of entities in the US need to report beneficial ownership information (BOI) to the Financial Crimes Enforcement Network (FinCEN) as part of the Corporate Transparency Act (CTA). Nonprofits without 501(c) tax exemption formed before that date must submit BOI by December 31, 2024, while those formed after must submit it within 30 days of formation. Once 501(c) tax exemption is granted, the organization may claim an exemption from BOI reporting requirements via an update filing to FinCEN. Our BOI Reporting Service includes up to four initial, updated, and corrected reports per year, ensuring the data you report to FinCEN is updated.

13. Apply for State Tax Exemption(s)

    With your IRS Determination Letter in hand, make sure you familiarize yourself with your state’s requirements for recognizing your nonprofit’s tax-exempt status. This is an area where requirements vary state-by-state. Many states issue their own tax-exempt certificate that can be used for sales and use tax purposes, but it may require application and periodic renewal.

    To file to obtain exemption from state income tax:

    Not required

    
    
    

    Generally, nonprofit corporations are not subject to the Ohio commercial activity tax. Agricultural and consumer cooperatives are.

    More information: Ohio Department of Taxation

    To file to obtain exemption from state sales tax:

    Not required

    
    
    

    Ohio nonprofits that have received their IRS determination letter are automatically exempt from paying state sales tax. They must present Form STEC-B: Sales and Use Tax Blanket Exemption Certificate to sellers.

14. Register for Charitable Solicitation (Fundraising)

    This is another area where laws differ from state to state, but most states require any nonprofit soliciting donations to register to do so on an annual basis. This means registering in the state prior to soliciting any resident of that state. Registering in your home state is essential, but you may also need to register other states depending on the scope of your organization.

    Ohio Charitable Registration

    Agency:	Ohio Attorney General
    Law:	Ohio Revised Code § 1716.01 and Ohio Revised Code § 109.26
    Foreign Qualification is Prerequisite:	No
    Registered Agent (Special Agency) Required?	No

    One-Time Exemption Registration

    More Details

    Exemption Eligible Organizations:	Charitable Trust Act Exemptions: Any governmental unit. For purposes of this paragraph, "governmental unit" means a political subdivision, agency, department, county, parish, municipal corporation, instrumentality or other unit of the government of the United States, a state, or a foreign country. Organizations which are organized and operated exclusively for religious purposes. These include churches, conventions and associations of churches, or integrated auxiliaries of a church. Educational institutions which normally maintain a regular faculty and curriculum and normally have a regular body of pupils or students in attendance at the place where its educational activities are carried on Charitable trusts in which all charitable interests are contingent, revocable, or subject to an unlimited power of invasion for purposes other than charitable purposes Charitable trusts which are not located in Ohio. For purposes of this paragraph, a charitable trust is located in Ohio and must register if not otherwise exempt if it is incorporated or otherwise organized in Ohio, conducts program services in Ohio or has assets in Ohio. For the purpose of this paragraph, "assets" includes cash, inventory, equipment, real estate, securities, investments, financial accounts and any other property   Charitable Organizations Act Exemptions: Any religious agencies and organizations, and charities, agencies, and organizations operated, supervised, or controlled by a religious organization Any charitable organization that meets all of the following requirements: It has been in continuous existence in this state for a period of at least two years; It has received from the internal revenue service a determination letter that is currently in effect, stating that the charitable organization is exempt from federal income taxation under subsection 501(a) and described in subsection 501(c)(3) of the Internal Revenue Code; It has registered with the attorney general as a charitable trust pursuant to section 109.26 of the Revised Code; It has filed an annual report with and paid the required fee to the attorney general pursuant to section 109.31 of the Revised Code. Any educational institution, when solicitation of contributions is confined to alumni, faculty, trustees, or the student membership and their families Every person other than an individual, when solicitation of contributions for a charitable purpose or on behalf of a charitable organization is confined to its existing membership, present or former employees, or present or former trustees Any public primary or secondary school, when solicitation of contributions is confined to alumni, faculty, or the general population of the local school district Any booster club that is organized and operated in conjunction with and for the benefit of students of public primary or secondary schools Any charitable organization that does not receive gross revenue, excluding grants or awards from the government or an organization that is exempt from federal income taxation under section 501(a) and described in section 501(c)(3) of the Internal Revenue Code, in excess of $25,000 during its immediately preceding fiscal year, if the organization does not compensate any person primarily to solicit contributions.
    Filing Method:	Online
    Agency Fee:	$0
    Law:	ORC § 1716.03 and OAC 109:1-1-02
    Notes:	The registration requirement for charities in Ohio is established in two separate sections of law, meaning that charities may be exempt under one act but required to register under the other. Charities should file an online request for exemption determination if they believe they are exempt. Exemptions do not expire as long as the organization continues to qualify under the exemption criteria.

    Initial Registration

    More Details

    Filing Method:	Online
    Agency Fee:	$0 for organizations that have not yet solicited in Ohio. Fees range from $0-$200, depending on contributions, for organizations that have previously solicited in Ohio.
    Turnaround:	1 week
    Original Ink:	Not required
    Notarization Required?:	Not required
    Notes:	The CFO / treasurer must sign Some Ohio counties and municipalities may require charities that solicit in-person to register prior to fundraising.
    Before you Apply:	Domestic Applicants: Check the available exemptions to see if your charity is eligible for exemption from the full registration requirement. Look through the list of required attachments and make sure that you have each required document in hand before starting the registration application. Foreign Applicants: Check the available exemptions to see if your charity is eligible for exemption from the full registration requirement. Look through the list of required attachments and make sure that you have each required document in hand before starting the registration application. If you will foreign qualify in Ohio, obtain a certificate of good standing from your home state to submit during the foreign qualification process. The certificate cannot be more than 90 days old when filing foreign qualification documents.
    How to Apply:	Domestic Applicants: File entity formation documents with the Ohio Secretary of State. Create a filing account online and complete a charitable registration through the Ohio Attorney General's office. Foreign Applicants: Determine whether or not your charity will need to foreign qualify based on your activity in Ohio. If not required, skip to number 3. File foreign qualification documents with the Ohio Secretary of State. Create a filing account online and complete a charitable registration through the Ohio Attorney General's office.
    Required Attachments:	IRS form 990 Articles of incorporation Bylaws IRS determination letter List of officers and directors

    Registration Renewal

    More Details

    Filing Method:	Online
    Agency Fee:	For organizations registering under the Ohio Charitable Trust Act: $0 if assets are less than $25,000 $50 if assets are $25,000 to $100,000 $100 if assets are $100,000 to $500,000 $200 if assets are $500,000 or more   For organizations registering under the Ohio Charitable Organizations Act: $0 if contributions are less than $5,000 $50 if contributions are $5,000 to $25,000 $100 if contributions are $25,000 to $50,000 $200 if contributions are $50,000 or more
    Due:	Annually by the 15th day of the 5th month following the close of your fiscal year. So if your fiscal year ends December 31, then renewal is due by May 15. There is no official start to the renewal period, so renewals may be submitted as soon as financials become available for the most recently completed fiscal year.
    Due Date Extension:	Due dates are automatically extended for 180 days beyond the original due date.
    Original Ink:	Not required
    Notarization Required?:	Not required
    Penalties:	There is a $200 late fee per year per report.
    Required Attachments:	List of officers and directors

    Reinstatement

    Not required

    
    
    

    Charities wishing to renew a lapsed registration must submit a renewal filing and financial documents for each year not registered. These filings must be submitted separately with the required fee for each year + $200 per year late fee.

    Change of Fiscal Year

    More Details

    Filing Method:	Email to charitableregistration@ohioago.gov
    Agency Fee:	$0
    Turnaround:	1-2 business days
    Notes:	Your fiscal year can be changed by emailing charitableregistration@ohioago.gov written notice of the change including when the change occurred and what the new fiscal year end date is. Alternatively, the organization can email a copy of the short year Form 990 that was filed with the IRS.

    Cancelation

    More Details

    Form:	Final Annual Report and Asset Disposition
    Filing Method:	Mail, fax, or email to CharitableRegistration@OhioAGO.gov
    Agency Fee:	$0
    Notes:	An organization that no longer solicits in Ohio should fill out and return a Solicitation Withdrawal form, which the state provides upon request. Fees and/or final annual reports may be required, depending on when the organization ceased soliciting.

    To fundraise nationally or online, please see our Fundraising Compliance Guide. Our services manage your initial, renewal, and exemption filings in every state.

15. Obtain Other Business Licenses & Permits

    Running your nonprofit corporation legally also means securing all applicable licenses and permits. The range of local, state, and federal requirements is wide. Access resources like the Small Business Administration Business License & Permit look-up tool and search by your business type and locality.

    Ohio permits three forms of charitable games:

    • Bingo - Apply for a license with the Attorney General
    • Raffles - No license required, but specific qualifications apply.
    • Games of change (poker, crap, roulette, etc) - No license required, but specific qualifications and limitations apply.

    More information:	http://www.ohiogaminglaw.com/permitted/charitable/
    Bingo license:	Ohio Attorney General http://www.ohioattorneygeneral.gov/Business/Bingo-Operator
    See also:	IRS Pub 3079: Tax-Exempt Organizations and Gaming

Frequently Asked Questions

You’ve made it! You turned your passion into a legitimate nonprofit corporation exempt under IRS 501(c) and are benefiting your community. That solid foundation on which you built your organization requires ongoing maintenance. Investing in maintaining compliance with all of the government agencies is an ongoing responsibility and commitment needed to ensure your vision continues long into the future. Check out our compliance guide to learn more!

Once you have registered your nonprofit per the steps listed above, you will need to maintain compliance with all of the government agencies. Staying current with the IRS and state requirements is an ongoing responsibility. Continue reading our Ohio nonprofit compliance guide to learn more!

Continue reading "Ohio Nonprofit Compliance"

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