How many directors are nonprofit corporations required to have?
Most states require nonprofit corporation to have a minimum of three directors. However there are exceptions, and specific state laws do change, therefore we do recommend that you call us if you have a question in this regard. Currently, the following states only require, at minimum, one director: CA, CO, DE, IA, KS, MI, MS, NH, OK, OR, PA, SC, VA, WA & WV. In addition, the following states allow less than three directors if there are less than three members: LA, MA, MN & VA.
Some states only require one director, but the majority of states require a minimum of three directors. Contact us at 800-818-6082, 302-636-5440 or info@corporate.com with any questions. Return to top • What is a nonprofit corporation? A nonprofit corporation is formed for purposes other than generating a profit and no part of the organization’s income is distributed to its directors or officers. Examples of common nonprofit corporations are churches, schools, charities, museums, hospitals, volunteer organizations, homeless shelters and civic associations. Nonprofit corporations are formed to carry out a charitable, educational, religious, literary, or scientific purpose. The most common federal tax exemption for nonprofits comes from Section 501(c)(3) of the Internal Revenue Code, which is why nonprofits are sometimes called 501(c)(3) corporations. Contact us at 800-818-6082, 302-636-5440 or info@corporate.com with any questions. Return to top • What steps need to be taken to form a n
Most states require nonprofit corporations to have a minimum of three directors; however, some only require one director and others allow for less than three members. Top • What are the advantages of filing a nonprofit corporation? If your nonprofit is granted tax-exempt status under 501(c)(3) of the tax code, your corporation will be exempt from payment of federal corporate income taxes. With federal income tax rates at between 15% to 34% this can amount to quite a tax savings. A 501(c)(3) nonprofit is eligible to receive both public and private grants. Individual donors can claim a federal income tax deduction of up to 50% of income for donations made to 501(c)(3) groups. Nonprofits also receive the same limited liability protection as for-profit companies. This means that directors or trustees, officers, and members are typically not personally responsible for the debts and liabilities of the corporation. Other benefits include: • A corporation’s life is not dependent upon its membe
