Starting a Florida nonprofit can be both rewarding and scary! Let us help you break it down into easy chunks.
Starting a nonprofit in Florida can be very confusing, which is why you should consult an Accountant in Tampa before starting!
The 3 core things to know about starting a Florida nonprofit are:
Registering with the IRS
Registering with the State
State Licensing
1 - Registering your nonprofit with the IRS
There are 2 main things you need to take when registering your new nonprofit with the IRS.
Obtain your EIN (free)
File Form 1023 (fee based)
Your EIN will be your tax identification number for your business. When you apply for an EIN for a nonprofit organization, it’s important to note that it will automatically default to a Corporation and not a nonprofit organization. This is where Form 1023 comes into play.
Form 1023 is filed in order to convert your Corporation to a nonprofit. Submission of this form is for recognition from the IRS of exemption from federal income tax under section 501(c)(3). Form 1023 is a very long and thorough document that is imperative to starting your nonprofit.
Data to prepare in advance of filing Form 1023:
List the names, titles, and mailing addresses of your officers, directors, and/or trustees (minimum of 3)
Copy of your By-Laws
Describe completely and in detail your past, present, and planned activities. (who, what, when, where, and why did you start this nonprofit)
3-year P&L forecast of expected grants revenues, fundraising expenses, salaries, administrative costs, etc.
Your mission, vision, values, etc. for your nonprofit
If you’re a church, foundation, or another type of privatized nonprofit, there will be dedicated sections of questions specific to your business purposes
Example of Form 1023 and the types of questions to prepare for Form 1023
Fees & Forms when filing with the IRS:
If you file the Online Form 1023-EZ, the IRS processing fee is $275. (File if you think your nonprofit will bring in under $50k in average annual donations)
If you file the Longer / Paper Mailed Form 1023, the IRS processing fee is $600. (file if you think your nonprofit will bring in over $50k in average annual donations)
After you finalize Form 1023:
If your 501(c)(3) application (Form 1023) is approved, you will receive a Determination Letter in the mail as confirmation.
Important note: If this form is forgotten, your entity will remain a corporation and all donations will be (1) not tax-deductible to the donors because you’re not a 501(c)(3) and (2) taxable to your entity because you’re classified as a for-profit organization.
We highly recommend that you consult with a Tampa Accountant before registering for anything yourself as starting a nonprofit is a very paper-heavy process and requires a ton of research to make sure that you are following all compliance requirements between the IRS and the State. Taxes Tampa has helped dozens of nonprofits formalize and stay compliant, so contact us today to see if we can help you get started on your nonprofit today!
2 - Registering your nonprofit with the State of Florida
Once you’ve registered with the IRS, it’s time to move on to registering with the State. Luckily, this is the easiest step in the process: registering on Sunbiz.
Sunbiz is Florida’s Secretary of State listing site. From here, you can look up any for-profit and nonprofit organizations registered within the state and see who their owners are, where they’re located, and what their Tax ID is. Most people use this site when (1) double-checking a vendor's Tax ID and (2) double-checking if a business name is taken when registering a new one.
Registering your nonprofit with Sunbiz is very easy and user-friendly
Go to the Sunbiz Website
File your Nonprofit Articles of Incorporation
Pay the $87.50 filing fee
Wait 3-5 days and you will see your listing on the site
AFTER you obtain your IRS EIN and confirmation of your live Sunbiz Listing, you can now head to the bank to open your nonprofit's business bank account. Banks will double-check that both steps are completed before opening your account.
Important Note: Sunbiz is updated and renewed annually. It's important to remember to renew your listing because late fees are $400 + and jeopardize your standing with the state.
We highly recommend that you consult with a Tampa Accountant before registering for anything yourself as starting a nonprofit is a very paper-heavy process and requires a ton of research to make sure that you are following all compliance requirements between the IRS and the State. Taxes Tampa has helped dozens of nonprofits formalize and stay compliant, so contact us today to see if we can help you get started on your nonprofit today!
3 - Nonprofit Licensing with the State of Florida
After you’ve registered with the IRS and Sunbiz, it’s time to start registering with The Florida Department of Revenue (FLDOR) and with the Florida Department of Agriculture.
With the Florida Department of Revenue, the licenses you may need to apply for are:
Sales Tax (if your nonprofit organization will be selling items, or will be leasing or renting commercial or transient rental property to others in Florida, you will also need to register with the Department to collect, report, and pay sales and use tax)
Consumer's Certificate of Exemption (this provides exemption on purchases and leases of items or services by, and rentals or leases of real property and living or sleeping accommodations to, your nonprofit organization that is used in carrying on the organization's customary nonprofit activities)
Payroll Tax (whenever you’re ready to start compensating your officers, you will need to register as an employer with FLDOR)
With the Florida Department of Agriculture, the licenses you may need to apply for are:
Florida Solicitation of Contributions License (this is so you can solicit contributions in Florida. more info here)
In conclusion, we highly recommend that you consult with a Tampa Accountant before registering for anything yourself as starting a nonprofit is a very paper-heavy process and requires a ton of research to make sure that you are following all compliance requirements between the IRS and the State. Taxes Tampa has helped dozens of nonprofits formalize and stay compliant, so contact us today to see if we can help you get started on your nonprofit today!
Interested on how for-profit entities get taxed? Click here!
Why Work With Taxes Tampa?
For over a decade, Taxes Tampa has sought to be a communication-focused Tampa Accounting firm. We don’t operate on a volume-based business model which allows us to check in with our clients more than the average accountant in Tampa and offer our clients a more hands-on and advisory tax experience. We want to ensure you understand the ABCs of LLCs, Taxes, and everything in between. Contact us today for a free tax consultation with one of our Tampa Tax Accountants!
Foot Notes:
Does your nonprofit sell a product? Learn more about Sales Tax here! Click Here
Interested in learning about other FL Taxes you may be subject to? Click Here
Interested in learning about small business accounting tips + tricks? Click Here
Ready to meet with a Tampa Accountant to start your nonprofit? Click Here
Frequently Asked Questions:
How much does it cost to become a nonprofit in Florida?
How many board members do you need for a 501c3 in Florida?
Do nonprofits need to file tax returns in Florida?