shutterstock_96137972_smallHow appropriate that we are in the midst of the giving season, and today’s small business industry letter focuses on the businesses that give: nonprofits.

A nonprofit is defined as “an organization that uses surplus revenues to achieve its goals rather than distributing them as profit or dividends. Although nonprofit organizations are permitted to generate surplus revenues, they must be retained by the organization for its self-preservation, expansion, or plans.”

If you have a social or environmental cause that you feel passionately towards, so much so that you could make a job out of it, creating a nonprofit organization might just be for you!

How do I get started?

Starting a nonprofit isn’t all that different from starting your standard corporation or LLC save for a few details. After choosing a name and filing your articles of incorporation, you need to focus on creating a mission statement for your business. A mission statement is especially important for a nonprofit because it’s what the IRS and state tax agencies will take into consideration when deciding if your business will achieve a nonprofit status. Once you have a solid mission statement, it’s time to file for tax-exempt status. You’ll need to file form 1023 and pay a fee. Upon being reviewed, the agency will decide whether or not to grant tax-exempt status. Not too tricky, right?

How healthy is the nonprofit industry?

According to Urban Institute, the nonprofit sector has been growing steadily over time- both in size and financial impact. Between 2001 and 2011 alone, nonprofits have grown 25%- from 1,259,764 million to 1,574,674 million today.

Though it’s not an industry to become rich and famous in, the nonprofit industry is steady and healthy. It’s also a great industry to be in to dedicate your life to a cause you’re truly passionate about.

Have questions about starting your own nonprofit? Give us a call at 1 877 692 6772 or visit us online at www.mycorporation.com.

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