Starting a Nonprofit | NYCON
A nonprofit is a legally incorporated organization with responsibilities under state and federal law. Starting and sustaining a nonprofit is a significant challenge and requires thoughtful consideration. With over 100,000 charitable nonprofits in New York, many struggle with funding, staffing, and other resources due to overlapping missions, service areas, and a lack of preparation. This often leads to costly mergers or dissolutions.
Before moving forward, review the following action items:
Do Your Research
- Understand that a nonprofit is a legal corporation, which comes with formal responsibilities including bylaws, board governance, reporting, and compliance with state and federal laws.
- Quantify the need for your organization by reviewing local data, surveying community members, talking with stakeholders, and analyzing existing services to ensure your work addresses a genuine gap.
- Research other groups already engaged in the same or similar work.
- Ensure that starting a new nonprofit is the right solution or if the community could be better served by strengthening existing programs.
- Understand regulatory requirements, funding sources, and typical costs of starting and running a nonprofit in New York.
Consider Alternatives to Starting a Nonprofit
- Get involved with local organizations that share your mission—volunteer, join a board, work on a project, attend community meetings, or provide skills-based support. This helps you learn the field, build connections, and test your ideas before starting a new nonprofit.
- Consider a partnership with an existing organization. There may be opportunities to start a special program under the umbrella of an established nonprofit.
- Explore fiscal sponsorship, where an existing nonprofit serves as the fiscal sponsor for your project, providing financial and administrative support while you focus on program delivery.
- Start a local chapter of a national or regional organization or association.
- Consider coalitions or advocacy groups instead of a standalone nonprofit. Sometimes a collaborative network can achieve greater impact.
How Can NYCON Help?
Turning a compelling idea into a thriving nonprofit takes careful planning, expertise, and support. NYCON provides guidance and resources to help you navigate the legal, financial, and operational steps of starting a nonprofit.
Our Legal Services Group provides tailored support to ensure compliance with all legal requirements when forming a nonprofit organization. Costs for proper formation can range from $2,500 to $5,000 or more, depending on your organization’s goals, regulatory complexities, and preparedness. The filing process is estimated to take 6-12 months due to backlogs at the Department of State and IRS. You must be a current NYCON member to engage our legal team.
Other services include:
Formation of a New Nonprofit: Main Steps
1. Incorporate with New York State
Draft and file a Certificate of Incorporation with the New York State Department of State.
The Certificate must include:
- Organization name
- Mailing address
- Names of the initial directors (minimum of three)
- Corporate purposes (your organization’s mission). Once incorporated, the organization may only engage in activities related to these stated purposes.
2. Adopt Bylaws
Prepare bylaws for your board to adopt. You must have at least three directors, as listed in your Certificate of Incorporation.
3. Apply for Federal Tax-Exempt Status
Apply for tax exemption with the Internal Revenue Service (IRS). You must obtain an Employer Identification Number (EIN) before filing.
The required IRS form depends on the type of 501(c) organization:
- 501(c)(3) charitable organizations file Form 1023 or Form 1023-EZ (if eligible).
- Other 501(c) organizations (such as 501(c)(6) trade associations or 501(c)(4) social welfare organizations) generally file Form 1024.
Helpful Resources
With NYCON by your side, you’re joining a network dedicated to helping nonprofits thrive across New York.
