State Parks Foundation
This page provides general information about the
steps to follow to create a new foundation to support a West Virginia
state park. It is assumed that the new foundation will be a West
Virginia non-stock nonprofit corporation and will request 501(c)(3) nonprofit designation
from the Internal Revenue Service.
Please Note: This page is still an early draft. Please let Bob Hoke (email@example.com or 301-725-5877) know if you have any corrections or suggestions for improvements, or if you have questions.
There are some initial expenses
to get a new foundation started ($25 filing fee for
incorporating in West Virginia and $275 to apply for IRS tax-exempt
status). The Foundation has recently established a program to
reimburse new foundations for the $300 startup cost. Contact the
WVSPF Treasurer for more information on this program.
1. FIND YOUR INITIAL PEOPLE:
Get a group of people who will form the initial leadership of the
new corporation. The directors and officers of the new foundation
will be selected from these people.
2. PICK A FOUNDATION NAME:
Your corporation's name must contain one of the following words or
an abbreviation of one of the following: “corporation,” “incorporated,”
“limited,” or “company.” The most common name for park
foundations is "Parkname State Park Foundation, Inc.".
Your corporation's name must be distinguishable from the names of other
business entities already on file with the West Virginia Secretary of
State. Names may be checked for availability at the West Virginia
Secretary of State business name database.
You may reserve a name for 120 days by filing an Application for Name Reservation
with the West Virginia Secretary of State. The reservation must be
filed by mail and the filing fee is $15. However, this is probably not
necessary since you have just checked to see that your proposed name is not already in use.
3. GET AN EMPLOYER IDENTIFICATION NUMBER FROM THE IRS:
You will need an Employer Identification Number (EIN). Go to the IRS Web site here
to apply online. You should select the options for starting a new
corporation. You will need to enter the name and Social Security
Number of the person filing the EIN application. You will then
have to enter the address of the corporation. Once you submit the
application you will receive the EIN.
4. SIGN UP FOR ON-LINE REGISTRATION AT THE WV SECRETARY OF STATE'S WEB SITE:
Go to https://www.business4wv.com/
and sign up. You will need to pick a user name and
password. Most of the remaining steps in establishing your
corporation will be done through the Web site.
5. APPOINT A REGISTERED AGENT:
Every West Virginia corporation must have an agent for service
of process in the state. This is an individual or corporation that
agrees to accept legal papers on the corporation's behalf if it is
sued. A registered agent may be an individual who resides in West
Virginia, or a corporation or limited liability company authorized to
do business in West Virginia. The registered agent must have a physical
street address in West Virginia. The agent should agree to accept
service of process on your corporation's behalf prior to designation.
6. PREPARE AND FILE YOUR ARTICLES OF INCORPORATION:
Your corporation is legally created by filing Articles of Incorporation
with the West Virginia Secretary of State. The articles must include:
a. The corporate name and address; the name and address of agent for service of process;
b. The nature of your business; the number of shares the corporation is authorized to issue;
c. The name and address of each incorporator;
d. The number of acres of land the corporation holds or expects to hold in West Virginia.
e. A required dissolution clause that insures that assets are disposed of correctly.
The articles may be filed online at the Business4wvWeb
site. Be sure to use the form for a nonprofit corporation because
it includes the required dissolution clause. This clause must
also be part of the Article of Incorporation when you apply for IRS
The filing fee is $25 for a nonprofit
corporation. Since you don't have a bank account someone will
need to pay the fee with a credit card and later be reimbursed.
7. PREPARE YOUR BYLAWS:
Bylaws are an internal corporate document that set out the basic ground
rules for operating your corporation. They are not filed with the
state. Your corporation is not legally required to have corporate
bylaws, but you should adopt them because they (1) establish your
corporation's operating rules, and (2) help show banks, creditors, the
IRS, and others that your corporation is legitimate. Look at other organization's bylaws as examples:
http://www.wvspf.org/bylaws.pdf (West Virginia State Parks Foundation)
http://www.msrlha.org/documents/bylaws.pdf (Mountain State RR & Logging Hist. Assoc. - Cass)
Also, there are many Web sites that provide suggestions for creating bylaws. Here are a few links:
http://nonprofitally.com/start-a-nonprofit/nonprofit-bylaws (click the topics for details)
http://form1023.org/how-to-draft-nonprofit-bylaws-with-examples (complete, complex, bylaws example)
http://ctb.ku.edu/en/table-of-contents/structure/organizational-structure/write-bylaws/main (scroll down to details).
8. APPOINT DIRECTORS:
The incorporator—the person who signed the articles—must appoint the
initial corporate directors who will serve on the board until the first
annual meeting of shareholders (when the board members who will serve
for the next term are elected by the shareholders).
9. HOLD YOUR FIRST DIRECTORS MEETING:
The first meeting of the corporation's board of directors should
be held at which the directors can appoint corporate officers, adopt
bylaws, select a corporate bank, and set the corporation's fiscal year.
The directors' actions must be recorded in corporate minutes prepared
by the incorporator or any of the directors. It is usually necessary to
prepare the minutes over one or two weeks, and then send them to all
the directors for their signature.
10. REGISTER AND GET A BUSINESS REGISTRATION CERTIFICATE:
business in West
Virginia must register with the West Virginia State Tax Department
before commencing business activities in the state. There is normally a
$30 fee, but the fee is waived for nonprofit corporations. To
register with the West
Virginia State Tax Department, you must complete the Application for
Registration Certificate (Form WV/BUS-APP) on the West Virginia
11. BUSINESS LICENSES:
As long as you don't have employees, don't sell things, and don't use
gambling to get money, you probably don't need any additional West
Virginia business licenses. Check with your local county to make
sure they don't have any local requirements..
12. OPEN A BANK ACCOUNT:
Once you are a real corporation you
can open a
bank account. You should have at least two people on the
account. One should obviously be the Treasurer, and any others
should be folks who are stable and are likely to remain involved with
the foundation for an extended time. Caution: Be sure to use the
foundation's EIN for the bank account and not someone's Social Security
13. APPLY FOR IRS TAX-EXEMPT STATUS:
You need to fill out an IRS Form 1023 to request exempt status.
There is an on-line version that can probably be used. Go to https://www.irs.gov/uac/About-Form-1023EZ
to get started. You will need to go through a long checklist of
questions to see if you are eligible to use the short 1023-EZ
form. Assuming you are, register with pay.gov, and complete the Form 1023 form. You
will have to pay a $275 fee using a credit card through the Pay.gov Web
site. (The fee was reduced from $400 to $275 on July 1, 2016). The 1023 instructions explain the process.
Line 1 of the Form 1023 asks for the 3-character NTEE code code that
best describes your foundation's purpose. The full list of codes
is in the 1023 instructions, but any of the following codes seem to be
C11 - Single Organization Support for Environmental Quality, Protection, and Beautification
N11 - Single Organization Support for Recreation, Sports, Leisure, Athletics
T11 - Single Organization Support for Philanthropy, Voluntarism, and Grantmaking Foundations
W11 - Single Organization Support for Public, Society Benefit - Multipurpose and Other
Another note: Although your corporate name says "Foundation", you are
going to be a public charity, not a private foundation as the IRS
defines it. Don't let the wording on the Form 1023 confuse you.
IRS publication 557 "Tax-Exempt Status for Your Organization" gives
much more detail about tax exempt status. It's at https://www.irs.gov/pub/irs-pdf/p557.pdf and is worth reading.
14. ANNUAL REPORT REQUIREMENTS:
Each year the corporation must file two reports:
1. West Virginia requires a very simple report and a $25 fee. Go to business4wv.com,
log in and select "Annual Report" in the "File Annual Reports" list in
the "Business Filings" tab on the left side of the main screen.
The hardest part of the form is listing the addresses for the
foundation's officers and up to two of its directors. There is a
$25 annual fee for filing the report.
One thing the Annual Report form asks for is your 4-digit "Business
Purpose" code. This is the NIACS code and none seem to really fit a foundation's
purpose. Codes commonly used by foundations include 7139 (Other
Amusement and Recreation Industries Including Golf Courses and Fitness
Centers, Marinas and Skiing Facilities) and 8132 (Grantmaking and
2. Until your foundation has over $50,000 in gross annual income, you must
electronically file a Form 990-N report with the IRS each year. Go to www.irs.gov/990n
for instructions and a link to the form. It takes about 10
minutes to complete the form and there is no fee. If you have
over $50,000 in gross income you have to file a more complex Form 990-EZ or Form 990.