How to Start a Nonprofit in Idaho

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Are you looking to start a nonprofit in Idaho? You’ve come to the right place. Known for its vibrant community and rich culture, Idaho (often referred to as The Gem State) is an ideal location for establishing a nonprofit organization. Unlike for-profit businesses, nonprofits focus on addressing pressing social issues and require a strong foundation, thorough research, and a clear mission targeting a specific community problem.

Embarking on the journey of creating a nonprofit entails various crucial steps, such as obtaining 501(c)(3) status. A 501(c)(3) organization is designed for charitable, religious, educational purposes, and more, qualifying it for federal and state tax exemptions.

In the spirit of Idaho’s motto, “Let it be perpetual (Esto perpetua),” thousands of nonprofits are founded within the state each year. This article will provide a comprehensive guide to starting your own nonprofit corporation in Idaho. Keep in mind that the steps discussed here are general guidelines, and modifications may be necessary depending on your specific circumstances. To gain a deep understanding of how to start a nonprofit in Idaho, we encourage you to read this article in its entirety.

On this page, you’ll learn about the following:

What is a Nonprofit in Idaho?
Types of Nonprofits in Idaho
How to Start a Nonprofit Corporation in Idaho
After Forming Your Idaho Nonprofit Corporation
- Names of Nonprofit Corporations in Idaho
FAQs

What is a Nonprofit in Idaho?

Nonprofit organizations are legal entities that operate to serve public benefits and address community issues. Unlike for-profit organizations, nonprofits do not aim to generate any profit. The Internal Revenue Service (IRS) generally exempts nonprofit organizations from tax. However, based on the business entity structure, you will receive tax exemptions as a nonprofit.

In Idaho, ensure you have a community issue to address before you start forming your nonprofit. It can generally be education, religion, charity, social service, or other social issues. Nonprofits do not pay taxes on the money they receive through fundraising programs, donations, or any charitable funding.

Types of Nonprofits in Idaho

The first thing one has to decide is what type of nonprofit structure one wants. There are several types of nonprofits one can start. Here is a list of nonprofit types one can choose from-

Nonprofit LLC
Nonprofit Corporation
Unincorporated Nonprofit

Forming an LLC in Idaho for your nonprofit can be a smooth option. However, having a corporation is less complex than having a nonprofit LLC. Hence, it is wise to start a nonprofit corporation instead of an unincorporated nonprofit or nonprofit LLC.
– LLCBuddy Editorial Team.

Technically, starting a corporation for your nonprofit protects your personal assets but also is eligible for Federal and State tax exemptions. When you form an LLC for your nonprofit, it only protects your personal assets but does not give you any tax exemptions. On the other hand, a nonprofit Corporation has both corporation and limited liability company benefits. You can also have an unincorporated structure where you don’t have to register it. Unincorporated nonprofits in Idaho might be eligible for tax exemptions (check with Idaho State Tax Commission), but this type of organization does not get to enjoy limited liability and personal asset protection.

How to Start a Nonprofit Corporation in Idaho

Setting up a nonprofit corporation requires a few things to consider. Name of the nonprofit, initial directors, drafting bylaws, get a Registered Agent, obtain tax IDs, insurance, and a bank account – these are important steps you must follow. The steps mentioned here are general business formation steps. State-wise, some steps can be different. Getting an expert consultation before you start your nonprofit corporation formation is recommended. Here are the steps explained below-

Step 1: Get a Suitable Name for Your Idaho Nonprofit Corp

The first step is to name your nonprofit corporation. You must be sure that the name is available and that no other organization is using this name. You can check the Idaho LLC name search to find the best suitable name for your organization. You must follow those rules to avoid any legal issues later. You can reserve the name for 4 months for any domestic entity (such as a nonprofit LLC) if you’re not forming the nonprofit immediately.

Step 2: Appoint the Initial Board of Directors

The next step is to get your nonprofit’s initial board of directors. It is very important when you are setting up a nonprofit corporation. You need at least Three unrelated directors to start the organization. If you don’t choose a minimum of Three directors, it will automatically become a member-managed corporation.

Step 3: Appoint Your Idaho Registered Agent

The third step is to get a Idaho Registered Agent for your nonprofit corporation. The Registered Agent is a person who receives all the legal documents on your behalf. It is necessary to get a registered agent. He/she must be above 18 years old and have a physical address in Idaho.

Step 4: Write Idaho Nonprofit Bylaws

The next important step is to write the company bylaws. The directors and board members must decide how the meetings, elections, voting, and other corporate activities will be held. These bylaws must comply with the Idaho state law. It is similar to an LLC operating agreement in Idaho for the LLC owners.

Step 5: File the Idaho Articles of Incorporation

This is the most important step. File your Articles of Incorporation with the Idaho Secretary of State. You can do it through three ways, online, by mail and in-person. All the formation forms, such as the Idaho LLC Certificate of Organization form, the Idaho Articles of Incorporation form for corporations, forms for LLPs, and all others can be found on the Idaho SOS official website. Submit the details of your nonprofit corporation, like the name of the nonprofit, address, name and address of the registered agent, operation dates, directors’ details, and more information related to your company. You can send the form (for offline filing) and the filing fee of $120 for filing in-person and by mail to the Office of the Secretary of State, 450 N 4th Street, P.O. Box 83720, Boise, ID 83720-0080 or upload it online (if available).

Step 6: Obtain Tax ID for Your Idaho Nonprofit Corporation

The subsequent step involves obtaining a Tax ID for your nonprofit corporation. You will need to acquire an Employer Identification Number (EIN) from the official IRS website. To obtain the EIN, submit your application to the IRS office either by mail or through their online platform. There is no associated cost for this process.

Step 7: Get Business Licenses in Idaho

The next step is to get the business licenses you need to run your nonprofit organization in Idaho. Check with the local government office if any special licenses you need to run your nonprofit. You can file your nonprofit as a charity if you want.

Step 8: Federal Tax Exemption

You must submit Form 1023 to the IRS to file for federal tax exemption. This form, titled “Application for Recognition of Exemption Under Section 501(c)(3) of the Internal Revenue Code,” is required for all nonprofit corporations. Smaller nonprofits have the option to file Form 1023-EZ instead. You will be prompted to provide details about your organization upon obtaining the relevant form. Complete the form with the necessary information and submit it. The filing fees are $600 for Form 1023 and $275 for Form 1023-EZ.

Step 9: State Tax Exemption

Once you get the Federal Tax Exempt, it is time for State Tax Exempt. In Idaho, you must apply for the tax exemption to Idaho State Tax Commission. Get the form, fill it up with the correct details, and send it to the office. You may need to pay a fee along with the form and supportive documents to apply for the State Tax Exemption. You need Form ST-101 to apply for the state tax exemption. Read Idaho classification of taxes to learn more about the Idaho tax structure.

Step 10: Get Insurance for Your Idaho Nonprofit

Once you start your nonprofit, you must get insurance to protect your organization. You must get workers’ compensation and unemployment insurance if you have employees. Based on your nonprofit structure, you might need general liability insurance, property, vehicle, auto insurance, etc. You can contact the insurance providers to learn more about which are required for your organization. Also, you can contact Idaho Department of Insurance for more information.

After Forming Your Idaho Nonprofit Corporation

Once your nonprofit is formed, there are additional steps to complete:

Get a Business Bank Account: You must get a business account for all types of business-related transactions in Idaho. You may need different documents based on the bank and place of business. Check with the bank for it.
File Nonprofit as Charity: This is optional. Your nonprofit is either for charity purposes or any purpose that meets your community’s needs. If your organization is for charity purposes, then you can file your nonprofit as a charity to enjoy tax exemptions.
Other Business Compliances: You may need additional compliances based on your nonprofit type. Check with your attorney or local authority for more information.

Names of Nonprofit Corporations in Idaho

Following are some of the Nonprofit Organizations in Idaho. The contact information of these organizations can be found on Idaho SOS official websites.

Make A Difference Now
Orphan Acres Inc.
Eden’s Song Ministry Inc.
Idaho Meth Project Inc.
The Mentoring Network Inc.
Idaho Humane Society Inc.
First Tee Idaho.
Sun Valley Jazz & Music Festival.

FAQs

How do I start a nonprofit in Idaho?

Starting a nonprofit in Idaho requires filing articles of incorporation and registering with the Idaho Secretary of State. You will also need to file for federal tax exempt status with the Internal Revenue Service.

What is the filing fee to start a nonprofit in Idaho?

The filing fee for articles of incorporation with the Idaho Secretary of State is $50.

Are there additional costs for filing for nonprofit status in Idaho?

Yes. The cost to file for federal tax exempt status with the Internal Revenue Service is dependent on the type and size of organization.

What taxes must a nonprofit pay in Idaho?

Generally, nonprofits are exempt from Idaho state income taxes. However, they may need to pay federal income taxes and Idaho sales taxes on the purchase of goods or services.

Do nonprofits in Idaho need to register with the state?

Yes. Nonprofits in Idaho must register with the Idaho Secretary of State to become a legal entity and be eligible for certain benefits such as tax exemptions.

Are there any reporting requirements for nonprofits in Idaho?

Yes. Nonprofits in Idaho must file annual reports and financial statements with the Idaho Secretary of State. Additionally, nonprofits must file Form 990 with the Internal Revenue Service.

Does my nonprofit in Idaho need to file for a charitable solicitation license?

Yes. If your nonprofit plans to solicit funds in Idaho, it must register with the Idaho Secretary of State and obtain a charitable solicitation license.

What are the requirements for board members of a nonprofit in Idaho?

Board members of a nonprofit in Idaho must be at least 18 years old and a majority of the board members must be Idaho residents. Additionally, at least three members of the board must sign the Articles of Incorporation.

How do I get my nonprofit recognized in Idaho?

Your nonprofit must be registered with the Idaho Secretary of State and obtain federal tax-exempt status from the Internal Revenue Service. Additionally, you may consider joining a local umbrella organization such as the Idaho Nonprofit Network.

Does my nonprofit need insurance in Idaho?

Yes. Many nonprofits in Idaho choose to purchase general liability insurance and professional liability insurance to protect their organization.

What are the steps for starting a nonprofit in Idaho?

There are six steps to starting a nonprofit in Idaho

How long does it take to start a nonprofit in Idaho?

It typically takes two to three months to complete the steps necessary to start a nonprofit in Idaho.

What paperwork is required to start a nonprofit in Idaho?

To start a nonprofit in Idaho, you will need to prepare and file articles of incorporation with the Idaho Secretary of State, apply for IRS tax exemption, apply for state tax exemption, and obtain any necessary licenses and/or permits.

Is there a fee to start a nonprofit in Idaho?

Yes, there is a fee for filing the articles of incorporation with the Idaho Secretary of State. The fee is currently $101.

What are the advantages of starting a nonprofit in Idaho?

The advantages of starting a nonprofit in Idaho include access to grant funding, potential tax exemptions, and the ability to accept tax-deductible donations.

How do I find other nonprofits in Idaho?

You can find other nonprofits in Idaho by searching the Idaho Secretary of State’s website or by searching the IRS Tax Exempt Organizations Database.

Are there any special requirements for nonprofits in Idaho?

Yes, nonprofits in Idaho must register with the Idaho Secretary of State, obtain a federal employer identification number, and comply with all federal, state, and local laws.

Does Idaho require nonprofits to conduct an annual audit?

Yes, Idaho requires nonprofits to conduct an annual audit if their total gross revenues exceed $250,000 in a fiscal year.

What is the Idaho Charitable Solicitations Act?

The Idaho Charitable Solicitations Act is a law that requires nonprofits to register with the Idaho Secretary of State before soliciting donations from Idaho residents.

What is the Idaho Nonprofit Corporation Act?

The Idaho Nonprofit Corporation Act is a law that governs how nonprofits in Idaho are formed and operated.

What is the Idaho Consumer Protection Act?

The Idaho Consumer Protection Act is a law that protects consumers from fraudulent and deceptive acts by businesses. Nonprofits in Idaho must comply with this law.

Does Idaho require nonprofits to register with the Attorney General?

Yes, nonprofits in Idaho must register with the Idaho Attorney General’s Office before soliciting donations from Idaho residents.

Does Idaho require nonprofits to have a board of directors?

Yes, Idaho requires nonprofits to have a board of directors that meets at least annually to oversee the organization’s activities.

Are there any exemptions from the Idaho Charitable Solicitations Act?

Yes, certain nonprofits may be exempt from the Idaho Charitable Solicitations Act if they meet specific criteria.

Does Idaho require nonprofits to file annual reports?

Yes, nonprofits in Idaho must file an annual report with the Idaho Secretary of State.

Does Idaho require nonprofits to have bylaws?

Yes, Idaho requires nonprofits to have bylaws that outline the organization’s purpose, membership, board structure, and other important matters.

What is the Idaho Business Organization Code?

The Idaho Business Organization Code is the state’s comprehensive law governing the formation and operation of nonprofit organizations.

Does Idaho allow nonprofits to lobby?

Yes, nonprofits in Idaho may engage in limited lobbying activities as long as they comply with applicable federal, state, and local laws.

Does Idaho require nonprofits to hold an annual meeting?

Yes, Idaho requires nonprofits to hold an annual meeting of the board of directors and members.

Does Idaho require nonprofits to have insurance?

Yes, Idaho requires nonprofits to have certain types of insurance, such as liability and property damage insurance.

Does Idaho require nonprofits to have a registered office?

Yes, Idaho requires nonprofits to have a registered office in the state where the organization’s records are kept.

Does Idaho require nonprofits to obtain a business license?

Yes, Idaho requires nonprofits to obtain a business license in the city or county where the organization is located.

Does Idaho require nonprofits to file annual financial reports?

Yes, Idaho requires nonprofits to file an annual financial report with the Idaho Secretary of State.

Conclusion

Starting a nonprofit corporation in Idaho is an incredible way to give back to your community and positively impact the causes that matter most to you. By forming a nonprofit, you can provide essential services, promote awareness, and make a lasting difference in the lives of those who need it most. In Idaho, a lot of nonprofit organizations are there to cater to people in need. Starting a nonprofit corporation is better than an LLC, as it provides limited liability and tax benefits. It helps you save taxes. If you want to start a nonprofit in Idaho, you must follow the steps mentioned above in the article.