Whatever you do, don’t file your nonprofit articles of incorporation online. While the convenience of filing online might seem appealing, there are several compelling reasons to consider the traditional route instead.
1. The Fillable PDF Provides More Information Fields Than the Nonprofit Articles of Incorporation Online Form.
Illinois provides two options for filing nonprofit articles of incorporation. You can complete a fillable PDF form, or you can file online. When you compare the two versions, you’ll see that the fillable PDF has more fields to complete than the online form. For example, you may have more than one incorporator. The fillable PDF allows for three incorporators, with the flexibility of attaching another page if you have more. The online form only provides for one incorporator. There are no additional fields to add other incorporators.
2. The Fillable PDF Provides Greater Opportunity to Satisfy All Stakeholders.
Starting a nonprofit involves more than just filling out forms to check off a box with the state and federal government. It’s about establishing a mission and vision that provide real change for our clients and community. The online form has a checklist of nonprofit purposes allowed by the state,. It also includes general language from the IRS. There’s no place to share your organization’s mission or purpose from the founders’ point of view. On the other hand, the fillable PDF allows you to describe your purpose in a way that will satisfy the state, IRS and founders.
3. The Nonprofit Articles of Incorporation Online Form Does Not Address All IRS Requirements.
Your nonprofit articles of incorporation must include specific language in order to meet IRS requirements for tax-exempt status. Neither the fillable PDF form nor the online form has everything the IRS requires. The fillable PDF form allows you to attach the additional IRS provisions. The ability to include all necessary information upfront will help you to avoid problem on the backend, when you apply for tax-exempt status.
On the other hand, the online form does not have any designated fields to include these essential details. Excluding this language can delay processing your organization’s application for tax-exempt status.
4. The Fillable PDF Is More Closely Aligned With IRS Standards.
Remember, these forms were developed to satisfy the State’s purposes, and not for the IRS. It’s possible for your articles of incorporation to meet the requirements for Illinois nonprofits, but not be approved by the IRS when you apply for tax-exempt status. This can result in additional paperwork, more time and higher costs than expected..
There is no way to add any information to the online form to make sure it meets IR requirements. When you complete the fillable PDF, you can add attachments that address IRS requirements. This will give you a better chance of getting approval from the State and IRS.
5. Nonprofit Articles of Incorporation Created Online May Need to Be Amended.
It is impossible to fully meet IRS requirements for tax-exempt status using the State’s online form. As a result, you may need to amend your articles of incorporation and let the State know the specific changes that your board made. Amendments can be tedious, time-consuming and costly. Completing the fillable PDF correctly and including the appropriate attachments will strengthen your application for tax-exempt status.
Conclusion
Filing online is a quick and easy option. However, the potential drawbacks can outweigh the convenience. Using the fillable PDF for your nonprofit’s articles of incorporation provides more flexibility. The PDF allows you to include attachments that will help you to satisfy the State, IRS and organizational founders. This approach saves time, money, and effort in the long run. You will be able to focus on what truly matters: making a positive impact through your nonprofit organization.
Coming Soon
Nonprofit Utopia will be launching a complimentary master class, “How to Incorporate Your Nonprofit Without An Attorney”. Stay tuned.
About the Author
Valerie F. Leonard is the founder of Nonprofit Utopia, LLC, the ideal community for leaders who want to start, manage and scale nonprofits. She has more than 20 years’ experience starting, managing and growing nonprofits as a financial analyst for a major hospital medical system, a founding executive director of a neighborhood grant making organization and consultant. Learn more
