A non-profit organization is generally defined as any legal entity that is organized and operated for a collective, public or social benefit, instead of trying to generate a profit for its owners.

The first step to establishing any non-profit organization is to determine the unmet needs of the community or environment and make sure that there are not any organizations already established for that purpose. According to the National Center for Charitable Statistics, there were over 22,000 nonprofit organizations in South Carolina by 2012 (Harbor Compliance, 2016).

Once you have verified the need for the programs, then it is time to start making plans for the future.

Steps for Establishing a Non-profit Organization in South Carolina

1. Develop a name for the organization.

The organization's name helps to establish itself within the state. The name should also be a legal name that does not conflict with other registered organizations.

2. Write out a mission statement and vision.

The mission statement is no longer than 1 - 2 sentences that details the overall purpose of the organization. The vision statement will summarize the goals that the organization wants to achieve in the future.

3. Recruit Incorporators and Initial Directors.

Incorporators are recruited to sign any Articles of Incorporation for the organization and there needs to be at least one appointed. The directors make up the governing body of the organization and are the stakeholders. For South Carolina, the minimum number of directors is 3 and have to meet IRS requirements.

4. Appoint a Registered Agent.

The appointed agent holds the responsibility for receiving legal notices on behalf of the organization and they must be physically located within the state with regular business hours.

5. Develop and File Articles of Incorporation.

The articles of incorporation mark the official creation of the organization and document when/where the organization was formed along with other information necessary.

6. Draft the organization’s bylaws.

The bylaws are how the organization operates by defining different roles and duties for the positions within the organization. Also, the document serves as an operation manual for the organization.

7. File the Initial Report.

The Secretary of State requires for these update reports to be submitted once you have formed a non-profit organization, which usually falls within 90-days of registration. For the state of SC, it is due at the time of formation and the penalty for late submission is 5% per month not to exceed 25%.

8. Acquire an Employer Identification Number (EIN).