How to Start a 501(c)(3) Nonprofit RescueBy Ronna L. DeLoe, Esq.
How to Start a 501(c)(3) Nonprofit RescueBy Ronna L. DeLoe, Esq.
Even though protecting animals by creating a nonprofit rescue is a noble idea, such an organization is still a business—and needs to be run and managed in much the same way. You'll have a good chance of keeping your rescue open if you follow these steps for creating and running an efficient organization.
1. Plan and research.
These two steps are critical when opening a nonprofit rescue. Location is the first key to success. If you're in a rural area with a small population or there is already a similar organization in your region, starting a shelter in your area probably isn't the best place for it. Consider forming in a nearby city or large town where there is a greater need, but also make sure that the zoning laws allow for your type of organization.
Find out what other rescues do to succeed by researching online and at your local library. You can also visit other organizations to see how they operate and properly care for animals.
If you've never run a business, learn what it takes to operate one. A nonprofit animal rescue needs people who can perform administrative tasks such as answering phones, bookkeeping, fundraising, and marketing. You need to get the right people on board, including employees, volunteers, veterinarians, accountants, lawyers, pet food companies, and cleaning crews.
2. Choose a name.
Once you've decided to start a rescue, you'll need a strong, identifiable name that indicates what your organization does. Carefully choose your business name so it will appear at the top of online searches, being sure to include words such as "shelter," "rescue," "animals," or the types of animals or breeds in the name. Ensure that the name is easy to remember and pronounce and doesn't cause confusion with a similar organization's name.
3. Prepare a mission statement.
After you've chosen your name, you need to prepare a mission statement, which lets the public know what your company does, who it does it for, how you'll accomplish your goals, and what its value to the public is. Decide whether you want to take in only dogs and cats, or if you want to include other animals, and say so in the statement.
Keep your mission statement short—only a few sentences—but make sure it is clear, positive, and upbeat. A mission statement is different from your goals, which is a separate document.
4. Set your goals.
While people often confuse a mission statement with goals, the two are related: your goals are statements about how you're going to accomplish your mission. For example, your goals could include whether you want your rescue to stay small or grow to the point where it's a nationally known.
5. Create a corporation and board of directors.
Turn your business into a corporation by creating and filing articles of incorporation, or have a business attorney do that for you to ensure there are no issues that might result in your having to refile. Register your business name with your state.
Decide who you want to include in your board of directors, such as veterinarians, attorneys, animal lovers, and people who have business and fundraising expertise. Make sure you know enough about your board members so you can determine if they'll work well together and if they're truly committed to the company's well-being.
6. Create bylaws.
You can do this yourself or have an attorney create corporate bylaws, which are rules for how the corporation will operate on a daily basis. The document includes information such as the name of the company, the members, how to amend the articles of incorporation and bylaws, when to have directors' meetings, how to deal with voting issues, and rules about stock, if applicable.
Bylaws are for corporate purposes only and don't require filing with the state. Not all states require bylaws, but it's a good idea for your corporation to have them.
7. File for nonprofit status.
This is done by filing for tax-exempt status under section 501(c)(3) of the Internal Revenue Service (IRS) tax code, which can be done on the IRS website through Application for Recognition of Exemption Under Section 501(c)(3) of the Internal Revenue Code (Form 1023) or the simplified Form 1023-EZ. To qualify, the corporation "must be organized and operated exclusively for exempt purposes" as set forth in the tax code, section 501(c)(3).
Also, check with your Secretary of State to see if you need to file anything with the state. If you prefer, have your attorney prepare these papers for you.
8. Deal with financial matters.
Decide whether your bookkeeper and accountant will be in-house or whether you'll hire a company to perform these duties. Prepare a budget for your company that is feasible based on the corporation's assets and debts. Determine how to handle marketing and fundraising activities and who in your nonprofit is best equipped to handle them.
9. Obtain licenses and insurance.
You'll likely need licenses and certifications for your nonprofit, so check with your state to see what licenses it requires. Make sure you have the appropriate insurance for your rescue shelter, such as liability, fire, accident, flood, workers' compensation, and whatever type of insurance your organization needs.
10. Define the corporation's policies.
In addition to what animals you will focus on helping, there are other factors to consider, such as:
- Whether the organization will be no-kill
- How many animals you'll take in
- When/if to turn away animals
- Whether to neuter and spay animals
- How to determine whether a potential adopter can care for an animal
- If it's ever acceptable to euthanize an animal and, if so, under what circumstances
Make sure that all key players have a copy of the corporation's policies.
Once you have these steps out of the way, you can focus on the first activities of your newly formed nonprofit, including holding your first meeting, fundraising, training personnel, and getting your name out to the public. While starting a nonprofit rescue may seem like a handful, you can reduce the amount of work and stress by having experienced and reliable volunteers and employees on board before you open your doors.
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