How to Start a Nonprofit in Wisconsin

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:	Wisconsin Department of Financial Institutions (DFI) - Division of Corporate and Consumer Services - Corporations Bureau Name search
   Suffix:	Shall contain the word "corporation", "incorporated", "company" or "limited" or the abbreviation "corp.", "inc.", "co." or "ltd." or words or abbreviations of like import in another language.  Wisconsin Statutes §181.0401

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.

   Wisconsin director requirements:	Number: minimum 3 Qualifications: Individual. No residency requirement. No membership requirement. Term: 1 year Quorum: majority Committee: minimum 3 directors
   Wisconsin officer requirements:	A president, a secretary, and a treasurer unless otherwise defined in articles or bylaws. Two or more offices may be held by the same individual.

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 Wisconsin registered agent office is located in Appleton, WI. 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:	Wisconsin Department of Financial Institutions (DFI) - Division of Corporate and Consumer Services - Corporations Bureau
   Form:	Articles of Incorporation
   Filing Method:	Mail or online.
   Agency Fee:	$35
   Turnaround:	~4-7 business days
   Law:	Wisconsin Statutes 181.0202
   Notes:	Submit original and one copy. The copy will be marked "FILED" and returned as evidence of filing. No certificate of incorporation is issued.

5. File Initial Report

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

   Not required

   
   
   

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.

10. Get Wisconsin State Tax Identification Numbers/Accounts

    Wisconsin offers a consolidated registration application for new business state tax registration.

    Submit to:	Wisconsin Department of Revenue http://www.revenue.wi.gov/
    Guidance:	Business Tax Registration Common Questions
    Form:	Form BTR-101: Application for Business Tax Registration
    Filing Method:	Mail, fax, or online
    Fee:	$20
    Turnaround:	~15 business days
    Notes:	Business Tax Registration (BTR) must be renewed after 2 years for a fee of $10.

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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    Dr. Bob A.Reform It Now, Inc.

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

    
    
    

    Upon obtaining your IRS Determination Letter, your organization is automatically exempt from Wisconsin corporation franchise and income taxes. No application or notification is necessary.

    More information: Wisconsin Department of Revenue

    To file to obtain Sales & Use Tax Exemption:

    Agency:	Wisconsin Department of Revenue
    Form:	Form S-103: Application for Wisconsin Sales and Use Tax Certificate of Exempt Status
    Agency Fee:	$0

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.

    Wisconsin Charitable Organization Registration

    Agency:	Wisconsin Department of Financial Institutions (DFI) - Division of Corporate and Consumer Services - Charitable Organizations and Fund Raisers Section
    Law:	Wisconsin Statutes Ch.202; Wisconsin Administrative Code, Chapter RL 5
    Foreign Qualification is Prerequisite:	No
    Registered Agent (Special Agency) Required?	No

    Automatic Exemption

    More Details

    Exemption Eligible Organizations:

    A person that is exempt from filing a federal annual information return under section 6033 (a) (3) (A) (i) and (iii) and (C) (i) of the Internal Revenue Code A candidate for national, state, or local office or a political party or other committee or group required to file financial information with the federal elections commission or a filing officer under s. 11.0102 (1) Charitable organizations which do not intend to raise or actually receive contributions in excess of $25,000 during a fiscal year and all of their functions are performed by volunteers and no assets or income are paid to any officer or member of the charitable organization A fraternal, civic, benevolent, patriotic, or social organization that solicits contributions solely from its membership A veterans organization incorporated under ch. 188 or chartered under federal law or the service foundation of such an organization recognized in the bylaws of the organization A nonprofit, postsecondary educational institution accredited by a regional accrediting agency or association approved under 20 USC 1099b, or an educational institution and its authorized charitable foundations that solicit contributions only from its students and their families, alumni, faculty, trustees, corporations, foundations, and patients A person soliciting contributions for the relief of a named individual if all contributions, without any deductions, are given to the named individual A state agency, as defined in s. 20.001 (1), or a local governmental unit, as defined in s. 605.01 (1) A private school, as defined in s. 118.165 Any corporation established by an act of the United States Congress that is required by federal law to submit to Congress annual reports, fully audited by the United States Department of Defense

    Law:

    WI Stat § 202.12(5)

    Initial Registration

    More Details

    Form:	Form 296: Charitable Organization Registration Application
    Filing Method:	Mail
    Agency Fee:	$15
    Turnaround:	4-6 weeks
    Notes:	Note the list of 17 attachments that first-time registrants must attach to the application. This includes disclosing contracts with professional fundraisers. The Preseident and CFO must sign. Signatures must be notarized. Some Wisconsin counties and municipalities may require charities that solicit in-person to register prior to fundraising.
    Before you Apply:	Domestic Applicants: Check the available exemptions to see if your charity is eligible for exemption from the full registration requirement. If your charity meets the audit threshold, obtain an audited financial report to submit with your registration application. Look through the list of required attachments and make sure that you have each required document in hand before starting the registration application. Foreign Applicants: Check the available exemptions to see if your charity is eligible for exemption from the full registration requirement. If your charity meets the audit threshold, obtain an audited financial report to submit with your registration application. Look through the list of required attachments and make sure that you have each required document in hand before starting the registration application. If you will foreign qualify in Wisconsin, obtain a certificate of good standing from your home state to submit during the foreign qualification process. The certificate cannot be more than 60 days old when filing foreign qualification documents.
    How to Apply:	Domestic Applicants: File entity formation documents with the Wisconsin Department of Financial Institutions (DFI) - Corporation Section. Submit a Charitable Organization Registration Application and all required attachments to the Wisconsin Department of Financial Institutions - Division of Banking. Foreign Applicants: Determine whether or not your charity will need to foreign qualify based on your activity in Wisconsin. If not required, skip to number 3. File foreign qualification documents with the Wisconsin Department of Financial Institutions (DFI) - Corporation Section. Submit a Charitable Organization Registration Application and all required attachments to the Wisconsin Department of Financial Institutions - Division of Banking.
    Required Attachments:	IRS form 990 Audited financials (if applicable) Charter/Articles of Incorporation/Agreement of Association/Instrument of Trust/other organizational instrument Bylaws (unless organized as a trust) IRS determination letter (or IRS form 1023 if exemption is pending) List of officers and directors List of persons with final custody of contributions List of persons responsible for final distribution of contributions Professional fundraiser or fundraising counsel contracts A certificate of good standing from the organization's home state Certificate of incorporation including any name change amendments List of other states where registered to solicit

    Registration Renewal
    Charitable Registration Renewal

    More Details

    Filing Method:	Online
    Agency Fee:	$54
    Due:	Annually by July 31. An organization that files an initial registration on or after June 1 does not need to renew their registration until the following calendar year. If an initial registration is filed before June 1, renewal must be filed by July 31 of the same calendar year. Renewals can be filed online as early as June 1.
    Due Date Extension:	Wisconsin does not grant extensions for charitable organization registration.
    Penalties:	There is a $25 late fee.
    Notes:	There are two renewal filings for charitable organizations: charitable registration renewal and charitable organization annual report. This annual renewal is different than the corporate annual financial report filed with DFI. The renewal period closes September 30th. After this date, you must file a new initial registration. You may not file for an extension of the due date. A CPA audit is required for large nonprofits.
    Required Attachments:	List of officers and directors

    Registration Renewal
    Charitable Organization Annual Financial Report

    More Details

    Form:	Annual Financial Reports may be filed on one of three forms that your firm can use based on qualifying factors.
    Filing Method:	Mail.
    Agency Fee:	$0
    Due:	You must file an annual financial report within 12 months after the close of your fiscal year if you received >$5,000 in contributions.
    Notes:	There are two renewal filings for charitable organizations: charitable registration renewal and charitable organization annual report.
    Required Attachments:	IRS form 990 Audited financials (if applicable)

    Change of Fiscal Year

    More Details

    Form:	Form 1952 or Form 308
    Agency Fee:	$0
    Turnaround:	1-2 business days
    Notes:	Submit the short year financials during the standard renewal process.

    Cancellation

    More Details

    Agency Fee:	$0
    Notes:	To close out your registration, send a letter including the charity name, FEIN, date of closure, and reason for closure in writing.

    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.

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 Wisconsin nonprofit compliance guide to learn more!

Continue reading "Wisconsin Nonprofit Compliance"

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