Delaware provides nonprofits with many advantages, such as flexible governance, advantageous tax treatment and low administrative burden. But those benefits come at the cost of some drawbacks; ultimately, the best decision for your organization will depend on specific requirements.
Furthermore, your nonprofit must maintain ongoing compliance with the state and may need licensing or permits. These requirements vary by industry and can be complex to navigate.
Articles of Incorporation
Articles of Incorporation are the formal documents you file to form a business or nonprofit corporation. Once approved, you can apply for a business license, obtain tax IDs and begin conducting operations.
For nonprofit organizations, corporate bylaws and a conflict of interest policy are mandatory. These documents offer an in-depth view into your organization’s operations.
Articles are an essential legal document you’ll need to create before forming a Delaware nonprofit LLC. They help satisfy IRS requirements for tax exemption and State requirements for nonstock nonprofit corporations.
Federal Employer Identification Number (EIN)
Once a Delaware nonprofit LLC is formed, it must obtain an Employer Identification Number (EIN). This nine-digit number serves as your company’s identity and allows it to open bank accounts and apply for business loans.
The EIN number is a unique identifier that helps your company remain distinct from other businesses and allows for tax exemptions from the IRS and state agencies.
Obtaining an Employer Identification Number (EIN) is one of the initial tasks a startup should complete when they decide to launch their business venture. It can be done online or by post.
State Business License
Before your Delaware nonprofit LLC can officially commence operations, you must acquire a business license. This is required by law and can be acquired either online through the Division of Revenue’s One Stop portal or by mailing in Form CRA to them via postal service.
Your LLC may need local licensing or permits from the state and/or county, depending on what activities it plans on engaging in. This is particularly relevant if your nonprofit organization has operations spread across multiple cities/counties within Delaware.
In addition to obtaining your state business license, you will require a federal tax ID number (EIN). This nine-digit code uniquely identifies your organization and can be used when opening bank accounts, employing employees or applying for 501(c)(3) tax-exempt status.
Website Domain Name
Your nonprofit website is an integral element of your marketing plan. To ensure a strong presence online, get your domain name as soon as possible.
Start by running a Delaware trademark search to check if your chosen business name is already being used by another entity. This will help ensure that your trademark is unique, meets the state’s requirements, and prevent any potential legal issues in the future.
Once you’ve selected the ideal name, reserve it on the state website for 120 days. Doing this will prevent someone else from filing for the same title in Delaware.
Registered Agent
Establishing a Delaware nonprofit LLC requires having a registered agent. They are legally required to accept legal notices on your behalf and forward them promptly.
Registered agents can be either individuals or business entities and are legally responsible for receiving and delivering any legal documents such as summons, complaints, subpoenas, court notices and franchise tax notices on your behalf.
Hiring a professional registered agent service will allow you to focus on your mission and expand your Delaware nonprofit organization. They also guarantee that your nonprofit remains compliant with both Delaware’s and federal regulations.
