smARTstart

Getting Started - Incorporation or Fiscal Sponsorship

There are a number of considerations to address when starting a nonprofit. The Donors Forum has put together a thorough question and answer guide that outlines the process.

Legal Considerations
Arts organizations need to be legally organized, registered, and run as corporations. However, some specific differences exist between For Profit and Not For Profit corporations. The forms below have been reviewed and adapted by an attorney with particular experience in Illinois nonprofit law.

Developing Articles of Incorporation
Powers and Limitations (.doc)
Draft Articles of Incorporation (.doc)
NFP 102.10 - Articles of Incorporation (.pdf)
Articles of Incorporation (.doc)

Developing Bylaws
Draft Bylaws (.doc)
Detailed Bylaws (.doc)

Federal Requirements and Documents
A Note about Public Charities v. Private Foundations (.doc)
Conflict of Interest Policy (.doc)
Apply for Income Tax Exemption (.doc)
Sample: IRS tax exempt status letter (.pdf)
Sample: Power of Attorney and Declaration of Representative (.pdf)
Form 1023: Application for Recognition of Exemption (.pdf)
Federal Employer Identification Number (.doc)
Sample: Form SS-4: - Application for EIN (.pdf)
Sample: IRS Federal Tax ID letter (.pdf)
Political Activity (.pdf)
IRS Form 990-EZ: Short Form Return (.pdf)

Illinois Requirements and Documents
Illinois Applications and Registrations (.doc)
Obtain Authority to Solicit or Receive Contributions (.doc)
Reserve Your Corporate Name (.doc)
NFP 104.10 - Application for Reservation of Name (.pdf)
Form CO-1: Charitable Organization - Registration Statement (.pdf)
Form CO-2: Charitable Organization - Financial Information Form (.pdf)

City of Chicago Requirements
City of Chicago Applications and Registrations (.doc)

Other useful information
Steps to Becoming a 501(c)(3) -- © Executive Service Corps of Chicago
Life Cycle of a Public Charity
IRS website

Fiscal Sponsorship
As an alternative to incorporating as a 501(c)3, an organization might find it beneficial to find a fiscal sponsor.

• The process saves time and offers many efficiencies to the new organization - office space, administrative support, etc.
• The organization becomes a part of the parent organization and not just affiliated.
• The parent organization is legally responsible for the new organization.
• Using a fiscal sponsor allows an organization to solicit charitable funding - when starting a new nonprofit it may take several years before receiving funder assistance.
• Working with an established 501(c)3 can be a valuable learning experience for a new organization - specifically in organizational management and board governance.

Resources for Fiscal Sponsorship