How to Start a Nonprofit in Ohio

What is a nonprofit organization?

A nonprofit organization is a legal entity that aims to serve the public good rather than generate profit for owners or shareholders. According to the Ohio Secretary of State (SOS), the purpose of a nonprofit is to pursue charitable, educational, religious, scientific, or other purposes that benefit society.

The most common type is a 501(c)(3) organization, which qualifies for federal tax exemption under the Internal Revenue Code and allows donors to claim tax deductions for their contributions. Nonprofit organizations generally differ from for-profit businesses in several key ways.

• They must reinvest revenue back into the organization's mission rather than distribute it to individuals.
• The board of directors who govern them volunteer their time.
• They must operate transparently with public accountability for their activities and finances.

Why start a nonprofit in Ohio?

Ohio provides an exceptionally favorable environment for nonprofit organizations, with a streamlined state registration process and supportive resources. In turn, the state's robust nonprofit sector contributes over $100 billion annually to Ohio's economy. This demonstrates the significant impact these organizations have on communities throughout the state.

Here are a few of Ohio's nonprofit-friendly policies:

• Reasonable filing fees
• Clear regulatory guidance
• Comprehensive support resources through the Ohio Secretary of State's office
• Various Ohio state tax exemptions for qualifying nonprofits, including Ohio sales tax and real estate tax exemptions

Key steps to start a nonprofit in Ohio

To successfully launch a nonprofit in Ohio, pay careful attention to both state and federal requirements. Most of these steps build upon the previous ones, so it's important to complete them in order to ensure your organization meets local and federal legal requirements.

Step 1: Develop your nonprofit's mission and purpose

Well-articulated mission statements are important for all organizations, but especially for nonprofits. Your mission statement is the foundation for your entire organization and needs to clearly articulate your charitable purpose.

Take time to craft a mission statement that's specific, measurable, and clearly charitable in nature. Avoid vague language or purposes that could be interpreted as benefiting private interests. Your mission should address a genuine community need and explain how your organization will make a positive impact.

Step 2: Choose an organizational structure

Ohio offers three main structures for nonprofit organizations, each with distinct advantages and requirements.

• A nonprofit corporation is the most common legal structure for nonprofits. It operates under a board of directors according to its articles of incorporation and bylaws (internal rules). Nonprofit corporations offer limited liability protection for directors while maintaining 501(c)(3) status.
• An unincorporated nonprofit association is a noncorporate entity with two or more members that exists for a nonprofit purpose. It allows for less formal organization but still provides limited liability protection under the Uniform Unincorporated Nonprofit Association Act.
• Charitable trust is a type of irrevocable trust that a trustee holds and manages for charitable purposes. It allows individuals or organizations to dedicate assets to charitable causes and potentially receive tax benefits.

Step 3: Select a name and check availability

In addition to helping your nonprofit stand out and attract donors, the name you choose needs to comply with Ohio's business name requirements.

• It must be distinguishable from existing business and organization registrations.
• It can't inaccurately imply affiliation with a government, financial, educational, or professional agency or institution.

Once you have a name, search the Ohio Secretary of State's business database to check if it's available. You should also check for potential trademark conflicts by searching the U.S. Patent and Trademark Office database.

If you aren't ready to officially register, you can reserve a name for 180 days by filing Form 534B with the Ohio Secretary of State for a $39 fee. Ohio doesn't require unincorporated nonprofit associations to register with the Secretary of State, but they do require one to at least file a fictitious name, which informs the SOS that your organization will use a name other than its founder's legal name. 

Step 4: Prepare and adopt nonprofit bylaws

Bylaws serve as your organization's internal operating manual. Ohio law doesn't require nonprofits to adopt or file bylaws, but does recommend them. According to the SOS, nonprofit bylaws typically address the following matters:

• Statement of purpose
• Operational rules and regulations
• Methods for adding or adjusting bylaws
• Procedures for electing officers
• Officer and trustee powers and duties
• Members' rights

While the Internal Revenue Service (IRS) also generally doesn't require nonprofits to adopt bylaws, they do require tax exempt organizations to keep books, reports, and file returns based on an annual 12-month accounting period called a tax year. Bylaws are where organizations typically report their chosen accounting period to the IRS.

If you're unsure where to begin, LegalZoom offers a bylaws and resolutions creation service that can help ensure your documents are both comprehensive and compliant.

Step 5: Appoint a board of directors and officers

Ohio law requires nonprofit corporations to have at least three directors, unless there are fewer than three members in the organization. That said, more directors can provide better governance and community representation. Board members should be committed to your mission and bring diverse skills and perspectives to support your organization's goals.

Select directors who understand their fiduciary responsibilities and can contribute meaningfully to your organization's success. Avoid conflicts of interest by ensuring board members don't have financial relationships with the organization beyond their volunteer service. Establish clear job descriptions for officers including president, secretary, and treasurer roles.

Step 6: File articles of incorporation with the Ohio Secretary of State

To officially register your nonprofit with the state, submit your Initial Articles of Incorporation using Form 532B along with the $99 filing fee to the Ohio Secretary of State. You can file online through the Secretary of State's website, by mail, or in person at their Columbus office. Expedited processing is available for additional fees if you need faster approval.

Form 532B requires basic information about your organization including the following:

• Entity name
• Location
• Purpose
• Registered (statutory) agent's name
• Agent's address
• Incorporator's name and signature

Make sure your purpose statement meets IRS requirements for tax exemption for when you do apply for (501(c)(3) status. Unincorporated nonprofit associations don't need to file formation documents with the SOS, but should file an Agent Notification form (580) to provide the name and address of their organization and statutory agent. 

Step 7: Apply for a federal employer identification number (EIN)

Every nonprofit organization must obtain an EIN from the IRS, even if you don't plan to have employees initially. This nine-digit number identifies your organization for tax purposes and is required for opening bank accounts, filing tax returns, and applying for grants.

You can apply for an EIN online through the IRS website, which is the fastest method and provides immediate confirmation. Alternatively, you can apply by fax, mail, or telephone using Form SS-4. The online application is available Monday through Friday and typically takes just a few minutes to complete.

Step 8: Apply for federal tax-exempt status (501(c)(3))

To qualify for federal tax exemption and allow donors to claim tax deductions, you must apply for 501(c)(3) status with the IRS. Generally, organizations use Form 1023, which requires a $600 user fee and extensive documentation about your organization's activities, governance, and finances.

If your organization meets specific criteria—such as projected annual gross receipts under $50,000—you may be eligible for the simplified Form 1023-EZ with a reduced $275 fee. These forms can only be filed online through the IRS pay.gov system. The IRS typically takes 3–6 months to process 501(c)(3) applications, so plan accordingly.

Step 9: Comply with Ohio tax and regulatory requirements

While your nonprofit may be exempt from federal income tax, you still need to comply with various Ohio state income tax obligations. If you plan to make purchases for your organization, register for sales and use tax exemption by obtaining either Form STEC U (Sales and Use Tax Unit Exemption Certificate) or STEC B (Sales and Use Tax Blanket Exemption Certificate). These exemption certificates allow you to avoid paying state sales tax on qualifying purchases.

If your nonprofit will sell goods or services for more than six days per calendar year, obtain a vendor's license from the Ohio Department of Taxation and collect sales tax on your sales. For real estate ownership, apply for property tax exemption using Form DTE 23 with the Ohio Department of Taxation.

Step 10: Register for charitable solicitation (if applicable)

If your nonprofit plans to solicit donations from the public, you must register with the Ohio Attorney General's office. This registration ensures compliance with Ohio's charitable solicitation laws and provides transparency for potential donors.

Additionally, check with local municipalities where you plan to conduct fundraising activities, as many cities and counties have their own solicitation permit requirements. Some localities require separate permits for door-to-door solicitation, special events, or other fundraising activities.

Maintaining nonprofit compliance in Ohio

Once you've established your nonprofit, ongoing compliance is essential to maintain your tax-exempt status and remain in good standing with state authorities.

• Ohio compliance requires nonprofits to file Certificates of Continued Existence with the Secretary of State for a $25 filing fee if they have not submitted another business filing in the prior 5 years. Most charitable organizations also need to file an annual financial report with the Attorney General’s office.
• Federal compliance also requires nonprofits to file annual returns with the IRS. Most 501(c)(3) organizations file Form 990, though smaller organizations with gross receipts under $50,000 may file the simpler Form 990-N (e-Postcard).

For this reason, it's critical to maintain detailed financial records, meeting minutes, and documentation of your charitable activities from the beginning.

Common challenges and solutions for Ohio nonprofits

Many new nonprofits struggle to develop a solid organizational structure and consistent donor backing.

• Board development and governance issues. To build an engaged, skilled board, you need to demonstrate ongoing effort and clear expectations. Provide board orientation, establish term limits, and create committees to distribute workload effectively. Regular board training and clear communication about roles and responsibilities can help maintain strong governance.
• Funding challenges. Develop a diversified funding strategy that includes individual donations, grants, corporate sponsorships, and earned revenue where appropriate. Start building relationships with potential funders early and maintain detailed records of your impact to support future funding requests.

LegalZoom's network of experienced attorneys can provide guidance on compliance issues and help you navigate complex regulatory requirements as your organization grows.

Ohio nonprofit FAQs

How fast can I start a nonprofit in Ohio?

The complete process typically takes 3–6 months from initial filing to receiving federal tax-exempt status. Ohio's state incorporation can be completed in 1–2 weeks, but IRS processing of 501(c)(3) applications takes several months.

What documents are required to form a nonprofit in Ohio?

Generally, you'll need articles of incorporation (Form 532B), organizational bylaws, board resolutions, and various federal forms including Form SS-4 for your EIN and Form 1023 or 1023-EZ for tax exemption.

What is the cost to start a nonprofit in Ohio?

Basic costs include $99 for Ohio filing fees, $275–$600 for federal tax exemption applications, plus additional fees for name reservations, expedited processing, and professional services, if needed.

What are Ohio's 501(c)(3) requirements?

Your organization must be organized and operated exclusively for charitable purposes, with no private benefit to individuals, and must not engage in substantial lobbying or political campaign activities, outside of petitioning for reasonable changes in state or federal law.

Before engaging in petitions or protests, it's best to consult a lawyer about what political activities could jeopardize your tax exempt status.

Where do I find more nonprofit resources in Ohio?

The Ohio Secretary of State provides comprehensive guidance, and the Ohio Attorney General's office offers resources for charitable organizations through their Charitable Ohio program. Local nonprofit associations and community foundations also provide valuable support.

Can I run a nonprofit from home in Ohio?

Yes, you can operate a nonprofit from your home, but you'll need a statutory agent with an Ohio address for official correspondence and legal documents.

Do I need an attorney to start a nonprofit in Ohio?

While not legally required, consulting with an attorney experienced in nonprofit law can help ensure compliance with complex state and federal requirements and avoid costly mistakes.

Starting a nonprofit in Ohio is a meaningful way to address community needs and create lasting positive change. With careful planning, attention to legal requirements, and commitment to your mission, you can successfully launch an organization that makes a real difference in people's lives.

LegalZoom's comprehensive nonprofit formation services can guide you through each step of the process, ensuring your organization meets all legal requirements while you focus on advancing your charitable mission.

Edward A. Haman, Esq., contributed to this article.