About

Starting a Nonprofit:

A Self-Guided Resource

 

Thinking About Starting a Nonprofit?

The nonprofit sector plays a vital role in strengthening our communities, but starting a new nonprofit is a significant commitment of time and resources. Before you begin, we encourage you to explore whether forming a new organization is the best path forward or if an existing nonprofit might align with your mission.

This page provides self-guided resources to help you navigate the decision-making process and understand the key steps involved in establishing a nonprofit.

Starting a Nonprofit

Starting a nonprofit is a major commitment that requires careful planning, long-term sustainability, and regulatory compliance. Before taking this step, consider:

Does a similar nonprofit already exist?

What’s your long-term plan?

  • Do you have a plan for long-term financial sustainability? Many new nonprofits struggle with sustainability. Consider funding sources and operational needs beyond the first year.
  • Are you prepared to manage legal and tax obligations? There can be significant consequences to not keeping up with filing requirements, state regulations, and employer law.
  • Can you build a strong board and leadership team? A group of enthusiastic friends and family is a start, but you will need a robust set of skills and access to networks to have a successful and engaged board. While you may be the founder, you report to the board, who sets direction, budget, and policy.

Are there alternative ways to make an impact? 

Many well-intended organizations struggle due to overlapping missions and limited funding. Consider these alternatives:

  • Collaborate with an Existing Nonprofit: Partnering with a like-minded organization can increase impact without duplicating efforts.
  • Fiscal Sponsorship: Some nonprofits can "host" your initiative, allowing you to operate under their umbrella without forming a new entity.
  • Volunteer or Join a Board: You might achieve your goals by supporting an established nonprofit rather than starting from scratch.
  • Advocacy & Fundraising: Support an issue by launching fundraising efforts or awareness campaigns without starting a separate nonprofit.

Steps to Establishing a Nonprofit

If you've determined that forming a nonprofit is the right path, here are the key steps. This list is not intended to be all-inclusive of the steps needed to start a nonprofit but rather some of the main items to help you get started. We recommend that you seek professional legal advice when establishing a nonprofit.

1.  Define Your Mission and Vision

  • Conduct a needs assessment: What problem are you solving? Identify the specific problem your nonprofit will address.
  • Who will benefit from your work? Research existing organizations working on similar issues.
  • How will your organization make a measurable impact? Develop a unique value proposition to avoid mission redundancy.
  • Draft a business plan and financial model. 

2. Incorporate and Register Your Organization

  • Choose a name and check for availability in your state.
  • File Articles of Incorporation with your state’s nonprofit division.

3. Apply for 501(c)(3) Tax-Exempt Status

4. Build a Board and Governance Structure

  • Form a board of directors with a clear leadership structure.
  • Develop a board job description that outlines members’ roles and expectations.
  • Recruit members with diverse skills and commitment to your mission.
  • Draft bylaws outlining governance policies.

5. Develop a Financial & Operational Plan

  • Establish a startup budget and identify initial funding sources.
  • Open a nonprofit bank account and set up accounting systems.
  • Create policies for financial management and compliance.

6. Build Your Nonprofit’s Infrastructure

  • Develop a strategic plan outlining short- and long-term goals.
  • Create branding, marketing, and communication materials (website, social media, etc.).
  • Build partnerships and engage stakeholders.

Local & Regional Resources

FAQs & Common Pitfalls

  • How long does it take to start a nonprofit? The process can take several months or more, depending on state and federal requirements.
  • What are the most common mistakes new nonprofits make? Lack of funding strategy, weak governance, and mission duplication.
  • Can I pay myself as the founder? Yes, but your salary must be reasonable and approved by the board.

Leadership Council for Nonprofits does not provide legal advice or consultation for starting a nonprofit. The above is provided as a self-guided tool for general information only, and we recommend that you seek professional legal advice when establishing a nonprofit.