Required Language
Articles of incorporation tend to be similar. The style, language, and overall appearance of the document have evolved over time. They often look archaic, using language you are not likely to hear on the street, but this language is intentionally very precise.
The actual language each state requires is surprisingly basic and very similar. With few exceptions, every state supplies template articles containing the language it requires. Forms for each of the states are provided on the CD that accompanies this book. Before going any further, be sure to read and fully understand what is being asked of you in the forms. The documents are in Portable Document Format (PDF), requiring you to print them, sign them, and mail them to the office identified on the form.
Some states are converting to paperless corporation filings, allowing or even requiring electronic submissions. If you are incorporating in a state that has converted to electronic filings, the template you will use is still on the CD. Print, file, and retain an exact copy of the form you submit electronically.
State secretary of state offices usually handle nonprofit filings, but some states have authorized other offices to handle these documents. Appendix C contains a link to the National Association of Secretaries of State (NASS). The state secretaries of state offices handle corporate filings in most states. The current directory of state secretaries of state is also included on the CD enclosed with this book.
Each state has its own form and specific questions that you will have to answer; however, there are enough questions in common that we can go through most of them here to make it less daunting. Some forms start with the articles of incorporation and offer little or no explanation.
So let's have a look at the form.
NameThe Name section may also be identified as Article 1. Enter the name exactly as you want it to appear on all subsequent legal documents. No one will edit or spell-check what you put on the form. Any abbreviations or punctuation you use will remain as the name, so take this element seriously. Remember, if you use the word “The,” as in “The XYZ School for the Performing Arts,” it stays. The same holds true for abbreviations in parentheses, often used for longer names. If you put it on the form as your name, again, identifying our example of a performing arts school as “XYZSPA,” it stays. Carefully read the instructions for requirements regarding words such as Incorporated and Company.
Once you have decided on a name that is unique, consider registering the name immediately as a future website domain so it will be available to you when your organization is ready to build a site. Securing a domain name has become the essential first step in establishing an organization's identity both on the web and in the general community.
Run an Internet search of the name you plan to use; this is the easiest way to verify that your name is unique. Some states allow you to reserve a name prior to actually filing for incorporation. These states will have forms available through the same office that handles the incorporation. States will not allow names that appear to be misleading or that they consider to be indecent or vulgar.
TermThe term of existence is more often than not going to be “perpetual,” so check that box if it appears. This indicates that you are planning to be in existence forever, as opposed to simply existing for one project. Of course, if you are incorporating for the purpose of a short-term project as a state nonprofit and have no plans to apply for federal tax exemption, indicate this on the form along with your projected date of dissolution.
PurposeThe purpose of your organization is discussed later in this chapter because the IRS requires clear, specific language. If you do not plan to apply for federal tax exemption, you are not restricted in the language you may use: you are free to explain your purpose as you like.
AddressesUnless otherwise instructed, post office addresses are fine for the organization and the initial board of directors, but an actual street address must be listed for the registered agent.
NAICSSome states require the North American Industry Classification System (NAICS), which was established by the census bureau. For an NAICS classification, refer to the website
What happens after we send in our articles?
Provided everything has been properly filled out and you included the required fee, you will receive a formal document from the office in your state government that handles corporate filings embossed with the seal of the state. It is that certified document with a date stamped on it that you will copy and show as evidence of your incorporation status.
Some states require additional information, including plans for disposing of any leftover funds in the event the organization is dissolved. The IRS requires specific language that addresses dissolution, which will be discussed in greater detail later in this chapter in the section titled “Planning for the End — While Meeting IRS Standards!” Some states use the same form for nonprofit and for-profit corporations alike; groups registering as nonprofits are required to check a specific box. A few states ask you to write in on the form that your organization is nonprofit. Be sure to read the instructions and forms thoroughly.
Covering the BasicsOnce the state articles of incorporation have been filed with the secretary of state, you have met the most basic requirement for conducting business in your state. There are also local filings with your city or county for their respective business licenses; these filings are covered in Chapter 7.
Your state may require additional filings, so check the general instructions for the articles. There is no rule stating you need to apply for federal tax exemption, but there are time limits if you plan to do so. If you and your organization are satisfied with state incorporation and understand you will be responsible for federal corporate income taxes, you're good to go.
