What are nonprofit bylaws?
Bylaws for nonprofits are a set of rules that your nonprofit will be legally bound to abide by. These bylaws should outline how your nonprofit will operate, elections, board member responsibilities, membership qualifications and more.
What should be included in nonprofit bylaws?
For your nonprofit’s bylaws, you should create regulations that will allow your nonprofit to function the way you envision it. Do not be afraid to create procedures for worst-case scenarios like kicking someone off the board or revoking membership. At the same time, do not be too restrictive with these bylaws, as it might prevent your board from making changes to the bylaws down the line.
Consider including these categories when drafting your nonprofit’s bylaws:
- Nonprofit name
- Description of the nonprofit
- Purpose of the nonprofit
Details about the nonprofit board:
- Qualifications, responsibilities and restrictions for each board member
(For example, define how much control the president should have over the organization. What will they have to bring to a vote by the board?)
- How often elections should take place
- Procedures for board meetings, and other processes
- Who can be a member of your nonprofit
- Annual Dues
- Revocation of membership guidelines
- Fiscal year of the nonprofit
(For example, you can stipulate that all the nonprofit’s banking has to be done in the nonprofit’s name. If you need a nonprofit bank account check out our list of best banks for nonprofits)
- Audit schedule
- Records and reports standards
Depending on the state that you are planning to incorporate in, it is crucial to check what that state may mandate appear in your bylaws, for example: number of meetings, minimum number of board members, etc. Check with the office of your state’s Secretary of State to see what would be necessary to include your nonprofit.
Here’s a template to get you started with your nonprofit’s bylaws. Use this template as a starting point, and customize each section for your nonprofit.
Get a Free Nonprofit
When creating a nonprofit, creating a set of bylaws is one of the requirements for incorporating. Luckily for you, if you submit your email, we’ll send you a free nonprofit bylaws template.
What do you do with nonprofit bylaws once created?
Once you are done drafting your nonprofit’s bylaws, consider having a lawyer look over and verify your bylaws. Their legal training will help you clean up any potential loopholes or misleading verbiage in your bylaws.
Sign and submit
Once the legal review is finished, have the president of the board or nonprofit founder sign the document to make it official.
When you are incorporating your nonprofit, it is generally not required to submit the bylaws to the state secretary, but check with your specific state to be sure. The bylaws do not need to be published anywhere or be available to the public, but it is good practice for nonprofits to be transparent about their bylaws.
Apply to the IRS
When you apply to the IRS for tax-exempt status as a nonprofit, bylaws are one of the required attachments. The bylaws help define your nonprofit’s mission and way of operating.
Once you apply and are accepted, your nonprofit’s bylaws are kept on file with the IRS.
In a way, your nonprofit’s tax-exempt status is tied to your organization’s bylaws. If your nonprofit deviates too much from what is outlined in your bylaws, you could lose nonprofit status. Therefore, it is important to take the proper care in creating a set of bylaws for your nonprofit that will remain relevant to your nonprofit and set it up for long-term success.
Tip: Nonprofit bylaws are an important document for your organization, so be sure to keep the original document safe and have copies readily available.
Why do nonprofits need bylaws?
Nonprofits are required to have bylaws so that there is a clear set of guidelines that the nonprofit can operate by. This set of rules can help the nonprofit steer through potential internal or external challenges by clearly defining the organization’s mission, and board roles and expectations.
Can you change nonprofit bylaws?
It’s possible to alter your nonprofit’s bylaws. On your nonprofit’s yearly 990 form for the IRS, report the changes in the bylaws from the past year. That way, the IRS will be updated with your nonprofit’s new bylaws and your tax-exempt status will be protected.
Need help incorporating?
If you are just starting your nonprofit journey, don’t be shy to ask for help if all the necessary tasks get overwhelming. Between applying for an EIN, tax-exempt status and incorporating there are many tasks to juggle when starting a nonprofit.
Because of that, Crowded is happy to offer incorporation services for new nonprofits: EIN and incorporation. Get set up to begin your nonprofit while also getting a nonprofit bank account.
Our services are the cheapest on the market:
Registered agent fee
Our nonprofit bank accounts will allow your nonprofit to collect payments for dues, fundraising, event tickets, and more. Spend the money you collect with budgeted Visa digital or physical debit cards that you or your members can use. Your nonprofit’s funds will be secure in Crowded’s FDIC-insured bank accounts. Have a bank account for your nonprofit that is totally customized to its needs as a nonprofit.
Get your nonprofit up and running with Crowded today!