Founders usually come to us with the mission already clear. What is less clear is the sequence — what has to be filed, with whom, and in what order — before the organization can lawfully raise money and operate. Here is the map.
Step One: Incorporate Under New York Law
A New York charity is typically formed as a not-for-profit corporation under the Not-for-Profit Corporation Law. The certificate of incorporation matters more than most founders expect: it must contain the purpose and dissolution language the IRS requires for exemption, and certain purposes require consents from state agencies before filing. New York also requires an initial board of at least three directors.
Getting this document right the first time avoids amending it later — a step that requires board action and a new state filing.
Step Two: Organize Properly
Before any application goes to the IRS, the organization should have:
- Bylaws adopted by the board — governance mechanics, officer roles, meeting and voting rules
- A conflict of interest policy — the IRS asks about it directly on the exemption application
- An EIN from the IRS
- An organizational meeting documented in minutes, electing officers and adopting the foundational documents
Step Three: Federal Tax Exemption
Recognition of 501(c)(3) status comes from the IRS, not the state. Most organizations file Form 1023; smaller organizations that meet the eligibility limits may qualify for the streamlined Form 1023-EZ. The full application asks for narrative descriptions of activities, projected budgets, and governance answers — it is an underwriting file, and the quality of the answers affects both speed and outcome.
Step Four: New York Registrations
Two registrations are commonly missed:
- Charities Bureau registration. Before soliciting contributions in New York, most charities must register with the Attorney General’s Charities Bureau, then file an annual CHAR500.
- State tax exemptions. Federal exemption does not automatically exempt you from New York taxes — separate filings secure corporate franchise and sales tax exemptions.
Your First Year
The organizations that stay healthy treat compliance as a calendar, not a crisis: the annual IRS Form 990-series filing, the CHAR500, board minutes for every meeting, and clean records of restricted gifts. Miss the federal filing three years running and exemption is automatically revoked — a surprisingly common and entirely avoidable outcome.
Where Counsel Fits
Plenty of founders assemble the filings themselves. Where legal judgment earns its keep is in the purpose clause, the governance design, and the fundraising registrations — the pieces that are expensive to redo and painful to discover late.