Legal Question in Business Law in California

Re: Forming a non profit association

An association is not a corporation and vice-versa. Usually, nonprofits can be either an association or a corporation, but not both. The laws govering both forms of nonprofit organization are found in the Corporations Code. Nonprofit associations are covered between sections 18000 and 18640. Nonprofit corporations fall into three main categories: public benefit, mutual benefit and religious. See sections 5000 through 9690.

The laws of each other state in which the organization will operate must also be consulted and complied with.

I can tell you that there are some more or less boilerplate articles of incorporation for nonprofit corporations contained in various do-it-yourself books as well as lawyers' practice manuals on this subject, but due to the complexity of the law, the need to decide which type of organization you want to be, and the intended interstate nature of your organization, you are going to need a lawyer to set up your organization.

To make matters even more complex, if you want to be able to accept donations that the donors can deduct as charitable contributions, you have another major step - the IRS exemption application - to accomplish after the nonprofit organization is set up. "Nonprofit" and "able to accept donations which are deductible" are two different concepts, and being a nonprofit does not suffice to qualify an organization under the Internal Revenue Code's Section 501.