Bylaws for Non-Profit Charitable Organization

What are the bylaws for nonprofit organizations?

Bylaws for nonprofit organizations are foundational legal documents that outline how a nonprofit operates, how it governs itself, voting procedures, membership, and the appointment of directors and officers.

Incorporation and operation of nonprofit organizations is governed at both federal and state levels. In the U.S. there are three different types of nonprofit organizations:

• charitable organizations;
• welfare organizations; and
• trade associations.

This sample nonprofit bylaws can be used only for incorporation of a US charitable organization. In their turn, charitable organizations may serve various purposes, including the formation of business leagues, fund associations, veteran or armed societies, etc. Therefore, it is essential to state directly in a sample nonprofit bylaws the exact purpose for which the organization is created.

Every charitable organization within the U.S. should have valid bylaws for nonprofit activity. Some states may require submission of bylaws directly to the Secretary of State for completion of the registration process (e.g., Colorado, Connecticut). Contrary to that, in Texas, bylaws for nonprofit organizations shall not be submitted to the Secretary of State.

To apply for the exemption status with the IRS, every charitable organization shall present their signed nonprofit bylaws for further registration. Without it, an organization cannot prove their charitable status for federal authorities.

The parties involved in the creation and formation of a nonprofit bylaws template are incorporators or founders. Those could be individuals or legal entities who wish to establish and run a charitable organization to achieve certain social benefits. Once the template is ready, it should be signed by an organization’s president, secretary, or any other person according to the bylaws.

How to create a nonprofit bylaws template?

When creating a nonprofit bylaws template, it’s crucial to keep in mind three simple rules:

1. The text of a document shall define the clear internal governance of an organization.
2. The text shall define quorum for voting for the board of directors, as well as quorum for members (if applicable).
3. The wording of the document should be simple and unambiguous so that officers, members, or directors can consult it any time to find answers to their questions.

Every sample nonprofit bylaws should include a number of important provisions without which a document cannot be legally complete:

Board of Directors

A board of directors is an essential element of an organization’s internal corporate governance. The board of directors is responsible for strategic management of the organization. The text of solid bylaws for nonprofit organization usually lays out:

• the minimum number of directors;
• the director’s term (defined or indefinite period of time);
• grounds for the director’s resignation (e.g., loss of loyalty, violation of fiduciary duty, reaching a certain age threshold, etc.);
• meetings of the board (frequency, place of meetings, and required quorum).

Membership of the Organization

If a nonprofit organization plans to have members, then a template of bylaws for nonprofit charities should define the membership rules.

The role of a member in a nonprofit organization is not similar to a member of a partnership or LLC. In a nonprofit organization, members are not owners or founders of an organization, as is the case for an LLC. Members of nonprofit organizations are persons who wish to participate in their activities.

The rules governing membership include:

• eligibility criteria to become a member (e.g., age, education requirements, etc.);
• grounds for termination of the membership (e.g., failure to pay regular membership fees, violation of the organization’s internal rules and policies);
• frequency of members’ meetings and the minimum required quorum.

Appointment of Officers

Charity organizations may appoint various internal officers, for instance, president, vice-president, secretary, treasurer, etc. Each of the appointed officers shall remain responsible for an organization’s particular activity. For instance, a treasurer or CFO oversees financial affairs within the organization and monitors its compliance with applicable legislation.

Every nonprofit bylaws sample shall define:

• the exact list of appointed officers and their duties;
• duration of each officer’s term;
• grounds for the officer’s immediate resignation (e.g., commitment of a criminal offense).

Dissolution of Organization

The Board of Directors is the only governing body of an organization that can adopt a decision on dissolution. The text of bylaws for nonprofit organizations should define the quorum to adopt such a decision. The adoption of a decision on an organization’s dissolution requires more advanced quorum —e.g., 2/3 or 3/4 of all directors in the Board.

Dissolution of a nonprofit organization has its specifics. Unlike with a dissolution of a for-profit organization, the distribution of remaining assets from nonprofit organization amongst its members is not possible. Opposite to that, a nonprofit organization in liquidation is able to transfer their assets to another charitable organization or directly to the government.

How to customize a legal template at Faster Draft?

To get a fully personalized document, follow a few easy steps below:

1. Click the button “Create Document.”
2. Answer simple questions in the form.
3. Select a document’s format—sample nonprofit bylaws PDF or Word.
4. Make a payment.
5. E-sign, download, print, and use a nonprofit bylaws template in minutes.