How to Start a Nonprofit in Oregon


Steve Goldstein
Steve Goldstein
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Start a Nonprofit in Oregon

Are you looking to start a nonprofit in Oregon? You’ve come to the right place. Known for its vibrant community and rich culture, Oregon (often referred to as The Beaver 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 Oregon’s motto, “She flies with her own wings (Alis volat propriis),” thousands of nonprofits are founded within the state each year. This article will provide a comprehensive guide to starting your own nonprofit corporation in Oregon. 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 Oregon, we encourage you to read this article in its entirety.

What is a Nonprofit in Oregon?

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 Oregon, 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 Oregon

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-

  1. Nonprofit LLC
  2. Nonprofit Corporation
  3. Unincorporated Nonprofit

Forming an LLC in Oregon 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 Oregon might be eligible for tax exemptions (check with Oregon Department of Revenue), but this type of organization does not get to enjoy limited liability and personal asset protection.

How to Start a Nonprofit Corporation in Oregon

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 Oregon 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 Oregon 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 120 days 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 Oregon Registered Agent

The third step is to get a Oregon 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 Oregon.

Step 4: Write Oregon 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 Oregon state law. It is similar to an LLC operating agreement in Oregon for the LLC owners.

Step 5: File the Oregon Articles of Incorporation

This is the most important step. File your Articles of Incorporation with the Oregon Secretary of State. You can do it through two methods, online and by mail. All the formation forms, such as the Oregon LLC Articles of Organization form, the Oregon Articles of Incorporation form for corporations, forms for LLPs, and all others can be found on the Oregon 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 $100 for online and by mail filing to the Secretary of State, Corporation Division, 255 Capitol St. NE, Suite 151, Salem, OR 97310 or upload it online (if available).

Step 6: Obtain Tax ID for Your Oregon 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 Oregon

The next step is to get the business licenses you need to run your nonprofit organization in Oregon. 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 Oregon, you must apply for the tax exemption to Oregon Department of Revenue. 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 no form to apply for the state tax exemption. Read Oregon classification of taxes to learn more about the Oregon tax structure.

Step 10: Get Insurance for Your Oregon 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 Oregon Insurance Division for more information.

After Forming Your Oregon 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 Oregon. 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 Oregon

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

  • Children’s Cancer Association
  • Child Foundation
  • Unite Oregon
  • Vestibular Disorders Association
  • Northwest Family Services
  • The Dreaming Zebra Foundation
  • Transition Projects
  • Ecology in Classrooms and Outdoors (ECO)

FAQs

What is a nonprofit organization?
A nonprofit organization is a type of organization that is set up to serve a charitable, educational, literary, scientific, religious or public service purpose. These organizations typically don’t have owners or shareholders and instead focus on fulfilling their mission.
What are the steps to start a nonprofit in Oregon?
The process of starting a nonprofit organization in Oregon includes filing paperwork with the Oregon Secretary of State, obtaining an employer identification number, registering with the Oregon Department of Revenue, registering with the Oregon Department of Consumer and Business Services, and recruiting board members.
What paperwork is required to start a nonprofit in Oregon?
The paperwork required to start a nonprofit in Oregon includes filing a Certificate of Formation with the Oregon Secretary of State, obtaining an employer identification number (EIN) from the Internal Revenue Service (IRS), registering with the Oregon Department of Revenue, registering with the Oregon Department of Consumer and Business Services, and filing Articles of Incorporation.
How do I file the paperwork to start a nonprofit in Oregon?
The paperwork to start a nonprofit in Oregon can be filed online or by mail through the Oregon Secretary of State. All documents must be properly completed and signed to be accepted.
Does Oregon have any special laws for nonprofits?
Yes, Oregon has some special laws for nonprofits, including the Oregon Nonprofit Corporation Act and the Oregon Public Benefit Corporation Act. These acts outline the rules and regulations that nonprofits operating in Oregon must adhere to.
What taxes do nonprofits in Oregon have to pay?
Nonprofits in Oregon are generally exempt from paying federal, state, or local income taxes. However, they may be subject to certain taxes, such as unemployment tax and excise taxes.
Do nonprofits in Oregon need to be registered with the Secretary of State?
Yes, all nonprofits in Oregon must be registered with the Oregon Secretary of State. This registration process includes filing a Certificate of Formation and Articles of Incorporation.
What is the Oregon Nonprofit Corporation Act?
The Oregon Nonprofit Corporation Act is a set of rules and regulations that all nonprofits in Oregon must adhere to. It outlines requirements for the governance, operation, and dissolution of nonprofits in Oregon.
Do nonprofits in Oregon need to register with the Oregon Department of Revenue?
Yes, nonprofits in Oregon must register with the Oregon Department of Revenue in order to receive tax-exempt status.
Do nonprofits in Oregon need to register with the Oregon Department of Consumer and Business Services?
Yes, nonprofits in Oregon must register with the Oregon Department of Consumer and Business Services in order to receive tax-exempt status.
What is an employer identification number (EIN)?
An employer identification number (EIN) is a unique nine-digit number assigned by the Internal Revenue Service (IRS) to all businesses and nonprofits in the United States. Nonprofits in Oregon must obtain an EIN in order to receive tax-exempt status.
How do I recruit board members for a nonprofit in Oregon?
To recruit board members for a nonprofit in Oregon, it is important to find individuals who are passionate about the mission and are willing to commit the necessary time and resources. Networking and using online resources can help to find potential board members.
Are board members of a nonprofit in Oregon required to serve a certain number of hours?
Yes, board members of a nonprofit in Oregon are generally required to serve at least one hour per week and attend at least four board meetings per year.
What are the responsibilities of a board member for a nonprofit in Oregon?
The responsibilities of a board member for a nonprofit in Oregon include setting the strategic direction of the organization, approving budgets, fundraising, and monitoring the operations of the organization.
How do I file annual reports for a nonprofit in Oregon?
Nonprofits in Oregon must file annual reports with the Oregon Secretary of State. These reports must be filed online and include a listing of the organization’s officers and board members, a financial statement, and a list of activities.
How do I file an Oregon charitable solicitation registration?
Nonprofits in Oregon that solicit donations must file an Oregon charitable solicitation registration with the Oregon Department of Justice. This registration must be renewed annually.
Do nonprofits in Oregon need to register with the Oregon Department of Human Services?
Yes, nonprofits in Oregon must register with the Oregon Department of Human Services in order to receive grants, contracts, or other forms of funding from the state.
What are the requirements for fundraising in Oregon?
Nonprofits in Oregon must adhere to certain regulations when fundraising. These include registering with the Oregon Department of Justice, obtaining a temporary license if necessary, and filing all required paperwork.
What are the reporting requirements for nonprofits in Oregon?
Nonprofits in Oregon must file an annual report with the Oregon Secretary of State, as well as an Oregon charitable solicitation registration with the Oregon Department of Justice. Nonprofits must also file a Form 990 with the IRS and register with the Oregon Department of Revenue to receive tax-exempt status.
How do I apply for tax-exempt status in Oregon?
Nonprofits in Oregon must register with the Oregon Department of Revenue to receive tax-exempt status. This includes filing a Form 1023 with the IRS.
Does Oregon have any resources for nonprofits?
Yes, Oregon has several resources for nonprofits, including the Oregon Nonprofit Association, the Oregon Department of Justice, and the Oregon Department of Revenue.
What are the benefits of forming a nonprofit in Oregon?
Forming a nonprofit in Oregon offers several benefits, including tax-exempt status, limited liability protection, and a way to serve the community.
Are there any restrictions on what a nonprofit in Oregon can do?
Yes, there are some restrictions on what a nonprofit in Oregon can do. These include adhering to all applicable laws, avoiding conflicts of interest, and not engaging in political activities or lobbying.
How can I find volunteers for a nonprofit in Oregon?
There are several ways to find volunteers for a nonprofit in Oregon, including networking, using online resources, and partnering with other organizations.
Are there any grants available for nonprofits in Oregon?
Yes, there are grants available for nonprofits in Oregon. These include grants from the Oregon Community Foundation, the United Way of the Mid-Willamette Valley, and the Oregon Department of Human Services.
What are the benefits of joining the Oregon Nonprofit Association?
The benefits of joining the Oregon Nonprofit Association include access to resources and networking opportunities, discounts on training and services, and discounts on registration fees for conferences.
Are there any special laws for nonprofits in Portland, Oregon?
Yes, Portland, Oregon has some special laws for nonprofits, including specific regulations for fundraising and charitable solicitation.
What documents do I need to form a nonprofit in Oregon?
To register a nonprofit in Oregon, you’ll need to prepare Articles of Incorporation, a Registered Agent document, a nonprofit bylaws document, and other forms required by the Oregon Secretary of State.
Is there a filing fee to form a nonprofit in Oregon?
Yes, there is a filing fee to form a nonprofit in Oregon. The amount varies depending on the type of nonprofit you’re forming.
How long does it take to form a nonprofit in Oregon?
The process of forming a nonprofit in Oregon typically takes around 4-6 weeks.
What are the ongoing requirements for maintaining a nonprofit in Oregon?
To maintain a nonprofit in Oregon, you must file an annual report with the Oregon Secretary of State, obtain an Oregon Annual Withholding Tax Return, and comply with other Oregon regulations.

Also Read

Why Oregon Nonprofit Corporation is So Important

One of the key reasons why Oregon nonprofit corporations are so important is their ability to fill gaps in public services and address unmet needs. While government agencies have limited resources and may not be able to fully meet the needs of all citizens, nonprofits step in to provide valuable services that would otherwise go unaddressed. In Oregon, where diverse communities face a wide range of challenges, nonprofit organizations play a critical role in supporting those in need and promoting social equality.

Furthermore, nonprofit corporations in Oregon serve as catalysts for innovation and creativity in addressing complex social issues. These organizations often bring together diverse stakeholders, including community members, experts, and policymakers, to collaborate on finding effective solutions to entrenched problems. By fostering partnerships and promoting collaboration, nonprofit corporations in Oregon are able to leverage their resources and expertise to drive sustainable and lasting change.

Oregon nonprofit organizations also serve as advocates for marginalized communities and amplify the voices of those who are often overlooked or marginalized. Through grassroots organizing, public education campaigns, and policy advocacy, nonprofits in Oregon work to advance social justice, equity, and inclusion. By shedding light on systemic injustices and pushing for policy reforms, these organizations play a crucial role in creating a more just and equitable society for all Oregonians.

In addition to their advocacy work, Oregon nonprofit corporations also contribute significantly to the state’s economy and employment landscape. These organizations generate thousands of jobs, stimulate local economic development, and contribute to the overall well-being of Oregon communities. By providing employment opportunities, fostering entrepreneurship, and supporting small businesses, nonprofit corporations in Oregon play a vital role in building a strong and resilient state economy.

Moreover, nonprofit corporations in Oregon play a central role in promoting environmental sustainability and conservation efforts. From protecting natural habitats to promoting renewable energy sources, these organizations are at the forefront of efforts to mitigate climate change and preserve the state’s natural resources for future generations. By raising awareness, mobilizing communities, and advocating for policy changes, Oregon nonprofit organizations are key players in ensuring a sustainable future for the state.

In conclusion, Oregon nonprofit corporations are indispensable in addressing a wide range of social, economic, and environmental challenges in the state. These organizations play a vital role in filling gaps in public services, promoting innovation and collaboration, advocating for marginalized communities, stimulating economic development, and promoting environmental sustainability. By supporting and empowering nonprofit organizations in Oregon, we can create a more just, equitable, and resilient state for all its residents.

Conclusion

Starting a nonprofit corporation in Oregon 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 Oregon, 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 Oregon, you must follow the steps mentioned above in the article.

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