How to Start a Nonprofit in Alaska

1. Name Your Organization

   Your organization’s name establishes its brand and is also important for incorporating with the state. The legal name of your nonprofit corporation may not conflict with any other organization registered in the state. Make sure the name is available and meets state requirements.

   Name Search:	Alaska Division of Corporations, Business and Professional Licensing Name search
   Suffix:	Not required.  AS §10.20.021

2. Recruit Incorporators and Initial Directors

   The incorporator is the person who signs the Articles of Incorporation for your nonprofit. You will need at least one, but can have more than one. Directors make up the governing body of your nonprofit corporation and are stakeholders in your organization’s purpose and success. You’ll want to identify three, unrelated individuals to meet IRS requirements. You will also want to be aware of any age or residency requirements.

   Alaska director requirements:	Number: minimum 3 Qualifications: Must be natural persons at least 19 years of age. No residency requirement. No membership requirement. Term: 1 year Quorum: majority Committee: minimum 2 directors on executive committee
   Alaska officer requirements:	A president, one or more vice presidents as prescribed by the bylaws, a secretary, and a treasurer are required. Two or more offices may be held by the same person, except the offices of president and secretary

3. Appoint a Registered Agent

   A registered agent is responsible for receiving legal notices on behalf of your organization. The appointed registered agent must be physically located in the state and maintain an office that is open during regular business hours. As a nationwide registered agent, our service is designed to receive your legal documents and provide secure access to those documents through your online account. Our local Alaska registered agent office is located in Anchorage, AK. We offer registered agent service independently or as part of our nonprofit formation packages.

4. Prepare and File Articles of Incorporation

   Your nonprofit’s articles of incorporation officially mark the creation of your organization. They document where and when the organization was formed and capture other information necessary to verify its existence. While requirements for language vary from state-to-state, there are some basic provisions that the IRS will look for when you apply for 501(c)(3) exemption. It is important to customize the articles for your organization and make sure you meet the state and IRS requirements. Meeting these requirements from the start will help avoid having to make amendments later or risk getting your 501(c)(3) application rejected. Some states will also require you to publish your articles of incorporation, so be mindful of any deadlines and publishing instructions.

   Agency:	Alaska Division of Corporations, Business and Professional Licensing
   Form:	Articles of Incorporation
   Instructions:	Instructions for Articles of Incorporation Domestic Nonprofit Corporation
   Filing Method:	Mail or online
   Agency Fee:	$50
   Turnaround:	~10-15 business days by mail. Immediately online.
   Law:	Alaska Statutes - Chapter 10.20: Alaska Nonprofit Corporation Act
   Notes:	The articles of incorporation may also contain a provision eliminating or limiting the personal liability of a director to the corporation for monetary damages for the breach of fiduciary duty as a director (AS §10.20.151(d)). Submit two copies of the articles of incorporation. Upon approval, one set of articles will be stamped "filed" with the date of filing and retained in the commissioner's office. The other copy will be attached to a certificate of incorporation and returned to you. (AS §10.20.156)

5. File Initial Report

   After filing articles of incorporation, you must file an initial report.

   Agency:	Alaska Division of Corporations, Business and Professional Licensing
   Form:	Enter your entity number then click 'Print Form'
   Filing Method:	Mail or Online.
   Agency Fee:	$0
   Due:	Within 6 months of incorporation.
   Law:	Alaska Stat. § 10.06.811

6. Obtain an Employer Identification Number (EIN)

   This unique, nine-digit number is assigned by the IRS to identify your nonprofit. All types of nonprofits will apply for an EIN, not only those that hire employees. You will use your EIN to open a bank account, apply for 501(c)(3) status, and submit 990 returns to the IRS.

   Agency:	Internal Revenue Service (IRS)
   Form:	IRS Form SS-4
   Filing Method:	Mail, phone, fax, or online.
   IRS fee:	$0
   Turnaround:	Immediately online or by phone. 4 business days by fax. 4-5 weeks by mail.
   Notes:	The IRS website is only available during certain hours. Print your EIN before closing your session. For additional guidance, see IRS Pub 1635: Understanding Your EIN.

7. Store Nonprofit Records

   As you launch your nonprofit, you will receive a number of official documents. Organizing these documents in one place will save you headaches down the road. You will soon have numerous items to keep in your records including your EIN letter, bylaws, meeting minutes, 501(c)(3) determination letter, and more.

   
   
   

   A great way to maintain necessary documentation is Records Manager, our software for storing records securely, tracking directors and officers, and getting notified of meetings.

8. Establish Initial Governing Documents and Policies

   Your bylaws are the governing document for your nonprofit. They serve as your organization’s operating manual and should be consistent with your articles of incorporation and the law. When your Board of Directors meets for the first time, you’ll review and ratify the bylaws and they will be a roadmap for governance from there.

   At the same time, you’ll also want to create and adopt a conflict of interest policy. A conflict of interest is when someone in a key position in your nonprofit has competing interests and is making choices that could benefit themselves to the harm of the organization. Personal interests should be set aside and organizational interests prioritized. If a conflict of interest does arise, it should be disclosed immediately.

   Your application to the IRS for 501(c)(3) exemption will require that both the bylaws and the conflict of interest policy are approved and adopted. Once they’ve been adopted, safely store them in your Nonprofit Records Kit.

9. Hold Organizational Meeting of the Board of Directors

   The initial organizational meeting of your Board of Directors will be incredibly productive. At this meeting you will approve the bylaws, adopt the conflict of interest policy, elect directors, appoint officers, and approve resolutions such as opening the organization’s bank account. Important decisions are being made so be sure to record them in the meeting minutes.

   In Alaska, you must provide a minimum of three days notice by mail for the initial meeting (AS §10.20.166).

10. Get Alaska State Tax Identification Numbers/Accounts

    Alaska does NOT offer a consolidated state tax registration application. Apply for each individual tax account that is needed.

    Guidance:	Alaska Tax Types
    Submit to:	Alaska Department of Revenue http://www.tax.alaska.gov/

11. Apply for 501(c)

    Applying for 501(c) tax exemption can feel like the most daunting step in bringing your nonprofit dream into reality, but obtaining tax exemption comes with many benefits. You will be able to apply for grants and grow your fundraising success in addition to being exempt from IRS income tax. 501(c) is the chapter of the Internal Revenue Code that regulates nonprofit organizations. Like others, you may be most familiar with 501(c)(3) nonprofits, including charities and foundations. 501(c)(3) nonprofits apply using Form 1023 or Form 1023-EZ. Review the criteria for each application and make sure you meet the eligibility requirements set out by the IRS. Other types of nonprofits, including 501(c)(4)s and 501(c)(6)s, apply using Form 1024. After reviewing and approving your application, the IRS will return a Determination Letter officially recognizing your exemption.

    Completing the federal application for tax exemption is significantly easier with the assistance and support of a professional. Find someone with the expertise to ensure the correct application is being used and is completed accurately. A well-prepared application takes time, over 100 hours by IRS estimates, so put yourself on the path to success by finding a specialist to walk alongside you in the journey - from start to tax-exempt finish!

    Agency:	Internal Revenue Service (IRS)
    Form:	IRS Form 1023, IRS Form 1023-EZ, or IRS Form 1024
    Instructions:	IRS Instructions for Form 1023, IRS Instructions for Form 1023-EZ, or IRS Instructions for Form 1024.  Also see guidance IRS Pub 557: Tax-Exempt Status for Your Organization.
    Filing Method:	Mail
    Agency Fee:	$275 for organizations filing Form 1023-EZ and $600 for organizations filing Form 1023.
    Turnaround:	1023-EZ average: <1 month. 1023 average: 3-6 months.

    

    Tax-Exempt in 2 Weeks!

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12. Apply for State Tax Exemption(s)

    With your IRS Determination Letter in hand, make sure you familiarize yourself with your state’s requirements for recognizing your nonprofit’s tax-exempt status. This is an area where requirements vary state-by-state. Many states issue their own tax-exempt certificate that can be used for sales and use tax purposes, but it may require application and periodic renewal.

    To file to obtain exemption from state income tax:

    Not required

    
    
    

    Exempt upon obtaining Determination Letter from the IRS

    More information: Alaska Department of Revenue

    To file to obtain exemption from state sales tax:

    Not required

    
    
    

    Alaska does not currently have a state level sales tax.

    Some nonprofits qualify for exemption from property tax. You may apply for Alaska property tax exemption.

13. Register for Charitable Solicitation (Fundraising)

    This is another area where laws differ from state to state, but most states require any nonprofit soliciting donations to register to do so on an annual basis. This means registering in the state prior to soliciting any resident of that state. Registering in your home state is essential, but you may also need to register other states depending on the scope of your organization.

    Alaska Charitable Organization Annual Registration

    Agency:	Alaska Department of Law - Consumer Protection Unit
    Law:	Alaska Statutes § 45.68.010 et seq. and 9 AAC 12.010
    Foreign Qualification is Prerequisite:	No
    Registered Agent (Special Agency) Required?	No

    Automatic Exemption

    More Details

    Exemption Eligible Organizations:

    Churches or religious organizations that are not required to file federal annual information returns with the IRS Candidates for national, state, or local office, and political parties, committees or groups that are required to file financial information with the Alaska Public Offices Commission An organization that has a current gaming permit issued by the Alaska Department of Revenue pursuant to AS 05.15.100 Charities with no paid employees or board members that do not raise or intend to raise more than $5,000 in contributions annually or that receive contributions from 10 or fewer persons

    Notes:

    Exempt organizations may elect to submit a Notice of Exemption to notify the Department of Law.

    Initial Registration

    More Details

    Filing Method:	Online
    Agency Fee:	$40
    Turnaround:	4-5 weeks
    Notes:	One authorized signature required. Signatures need not be notarized. Some Alaska counties and municipalities may require charities that solicit in-person to register prior to fundraising.
    Before you Apply:	All Applicants: Check the available exemptions to see if your charity is eligible for exemption from the full registration requirement.
    How to Apply:	Domestic Applicants: File entity formation documents with the Division of Corporations, Business and Professional Licensing. Register as a charity with the Department of Law - Consumer Protection Unit. Pay the registration fee online to start. You will then receive an email containing a link to a page where you can complete the registration. Foreign Applicants: Determine whether or not your charity will need to foreign qualify based on your activity in Alaska. If not required, skip to number 3. File foreign qualification documents with the Division of Corporations, Business and Professional Licensing. Register as a charity with the Department of Law - Consumer Protection Unit. Pay the registration fee online to start. You will then receive an email containing a link to a page where you can complete the registration.
    Required Attachments:	List of officers and directors

    Registration Renewal

    More Details

    Filing Method:	Online
    Agency Fee:	$40
    Due:	Annually by September 1. Renewals can be filed as early as July 1.
    Due Date Extension:	Alaska does not grant extensions for charitable organization registration.
    Notes:	Note the list of attachments required, including annual financial report.
    Required Attachments:	List of officers and directors

    Change of Fiscal Year

    Not required

    
    
    

    There is no need to notify the state of a change to an organization's fiscal year.

    Cancellation

    More Details

    Agency Fee:	$0
    Notes:	To close out your registration, email lawcharities@alaska.gov with the effective date of the cancellation and the reason for cancelling.

    To fundraise nationally or online, please see our Fundraising Compliance Guide. Our services manage your initial, renewal, and exemption filings in every state.

14. Obtain Other Business Licenses & Permits

    Running your nonprofit corporation legally also means securing all applicable licenses and permits. The range of local, state, and federal requirements is wide. Access resources like the Small Business Administration Business License & Permit look-up tool and search by your business type and locality.

    Nonprofits who wish to host bingo, raffles, lotteries, and other charitable games must comply with Alaska Department of Revenue - Charitable Gaming rules.

You’ve made it! You turned your passion into a legitimate nonprofit corporation exempt under IRS 501(c) and are benefiting your community. That solid foundation on which you built your organization requires ongoing maintenance. Investing in maintaining compliance with all of the government agencies is an ongoing responsibility and commitment needed to ensure your vision continues long into the future. Check out our compliance guide to learn more!

Once you have registered your nonprofit per the steps listed above, you will need to maintain compliance with all of the government agencies. Staying current with the IRS and state requirements is an ongoing responsibility. Continue reading our Alaska nonprofit compliance guide to learn more!

Continue reading "Alaska Nonprofit Compliance"

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