How to Form a Mutual Benefit Corporation in California

By Joe Stone

California law provides for several types of nonprofit corporations, one of which is called a mutual benefit corporation. The primary aspect of a mutual benefit corporation is that it is formed and operated solely for the benefit of its members, rather than making a profit. A mutual benefit corporation can be formed for any nonprofit purpose except a charity. To form a mutual benefit corporation in California, you file articles of incorporation with the Secretary of State’s office. You can download a sample form of articles from the secretary's website.

Step 1

Locate the sample form Articles of Incorporation for nonprofit corporations on the secretary of state's website. The form is optional but can be used as a guide to include the basic information needed to draft your own articles.

Step 2

Prepare the articles by inserting the following minimum information: the corporation's name (section I of the sample) and the name and address of the corporation's resident agent for service of process (section III of the sample). If you intend to apply for tax-exempt status for your corporation or are forming the corporation for a public purpose, you must include a statement in the articles specifying the corporation's specific purpose (section IIB of the sample). Section IIA of the sample sets forth mandatory language required by Corporations Code section 7130(b)(1).

Ready to incorporate your business? Get Started Now

Step 3

Sign the articles at the bottom of the page, as the incorporator, and print or type your name below your signature. Mail the form to the Secretary of State, Document Filing Support Unit, P.O. Box 944260, Sacramento, CA 94244-2600. As of November 2011, a check in the amount $30 is required for the filing fee. You can personally deliver the articles to the secretary's regional office in Los Angeles or Sacramento; however an additional $15 handling fee will apply.

Ready to incorporate your business? Get Started Now
Articles of Incorporation and Bylaws in Colorado


Related articles

How to Establish a Non-Profit Corporation in Florida

A nonprofit corporation may not issue stock or distribute dividends, although it may pay its employees reasonable salaries. In Florida, you form a nonprofit corporation by filing the articles of incorporation with the Florida Department of State. Subject to certain restrictions, a Florida nonprofit corporation can exempt itself from federal income tax, allow its donors to exempt donations from their taxable incomes, and avoid Florida state taxes. The nonprofit corporation must register with the state government to solicit donations from the public.

How to Form a Sub S Corporation in Texas

The term “Sub S Corporation” is a short for a corporation that has elected to be taxed under Subchapter S of the Internal Revenue Code. To form a Sub S corporation in Texas, you must first create the corporation as required by the Texas Business Organizations Code, and then file the appropriate form with the IRS to elect Subchapter S tax treatment. Corporations that do not make such an election are automatically taxed under Subchapter C of the Internal Revenue Code; they are sometimes referred to as C corporations.

Virginia Laws Regarding Nonprofit Organizations

In Virginia, nonprofit organizations are referred to as "nonstock corporations": no dividends may be paid to directors or officers of the corporation beyond reasonable compensation for their services. The formation and operation of all nonstock corporations is governed by the Virginia Nonstock Corporation Act, which provides specific rules with regard to naming the corporation, adopting bylaws and holding organizational meetings.

LLCs, Corporations, Patents, Attorney Help

Related articles

How Do I Become Incorporated in California?

You incorporate a business in California by filing articles of incorporation with the secretary of state. You can ...

What Is the Difference Between a Nonprofit and a Mutual-Benefit Corporation?

When you think of a "nonprofit," you likely envision an organization that provides a public service, such as feeding ...

Can an LLC Be Non-Profit?

LLCs are formed under state law, so if LLC owners -- called members -- want to operate the LLC as a non-profit venture, ...

How to Register an LLC in California

Similar to a corporation, a limited liability company, or LLC, is a form of business that exists as a separate entity ...

Browse by category
Ready to Begin? GET STARTED