Starting a nonprofit in Ohio
Starting a nonprofit organization in Ohio is governed by Chapter 1702 of the Ohio statutes titled “Nonprofit corporation law”.
Steps involved in starting a nonprofit organization in Ohio
Step 1. Choosing a name for nonprofit organization
Ohio rules does not require a nonprofit organization to use corporate designators like ‘Co.’,’Corp.’,’Ltd.’ etc in its name. Two important things to be considered when choosing a name for the nonprofit organization are –
1) The name must be distinguishable from any other entity on records of the business services division of the office of Secretary of States Ohio.
2) The name should not be indicative of a misleading purpose. (ie. a purpose other than the purpose for which the organization is being instituted).
Other factors to be considered when naming a Non profit organization can be assessed here.
Step 2. Drafting the Article of Incorporation
As per Ohio statutes, the article of Incorporation of an Ohio based nonprofit organization must include-
(a) The name of the nonprofit organization that meets the requirements mentioned above.
(b) Valid Ohio based street address where the principal office of the nonprofit organization is to be located.
(c) The purpose(s) for which the said nonprofit organization is being instituted.
Optional article of incorporation provisions:
As per Ohio statutes, the Article may additionally include provisions specifying –
(d) The names of all the initial directors of the proposed nonprofit organization.
(e) The names, classification and qualifications of members of the nonprofit organization.
(f) A provision specifying the name of any parent organization (if any).
(g) Provisions governing the distribution of assets on dissolution of the nonprofit organization.
(h) the duration of existence of the nonprofit organization. (if not mentioned, the duration is presumed to be perpetual.)
(i) Any other lawful provision that is desired to be included for effective governance of the nonprofit organization.
Clauses for obtaining 501(c)(3) tax exempt recognition
IRS prescribes addition of certain clauses for organizations seeking 501(c)(3) tax exempt recognition. The exact wording of clauses to be included in the article can be assessed here. (opens in anew window).
Download sample Article of Incorporation
Sample article of Incorporation as prescribed the office of secretary of state for an Ohio nonprofit organization can be downloaded here.
This format has minimal provisions as required under Ohio laws. The format does not include the IRS clauses as mentioned above and have to be added separately to the article.
Step 3. Filing the Article of Incorporation
Executing the Article of Incorporation – The Article so prepared must be printed on white blank sheets of paper and signed across on all the pages by the incorporators of the nonprofit organization.
Filing fee – The fee payable for starting a domestic nonprofit corporation in Ohio is $125. Expedited filing provisions are also available upon payment of an extra $100 towards the expedited filing fee. The filing fee is payable through check favoring “Secretary of State”
Where to File
Duly completed article of incorporation along with the check for filing fee must be mailed across to : P.O Box 670, Columbus, OH 43216
If the organization is applying for expedited filing – the documents along with check drawn for extra $100 must be mailed across to: P.O box 1390, Columbus, OH 43216.
Time required for filing: Filing the articles and the incorporation process takes around 3-7 working days from the day it is received in the filing office. Expedited filing can be completed in as less as 24 hours by paying the expedited filing fee.
Birth of the Nonprofit organization – A nonprofit organization comes into formal legal existence in Ohio upon successful filing of the Articles of Incorporation with the office of the Secretary of States, Ohio.
Conclusion- The process of filing for Incorporation process is a valuable learning experience for any one planning to form and manage a Nonprofit organization in Ohio.
Though the process can be outsourced to professional incorporation service providers for a fee, many people do this on their own for the sake of this learning.
Even if you decide to outsource the incorporation procedures, it is advised not to let service providers draft the Articles and bylaws as these two documents govern how a nonprofit functions on a day to day basis.