How to Start a Nonprofit in Vermont

To start a nonprofit in Vermont and get 501c3 status, follow these steps:

Step 1: Name Your Vermont Nonprofit
Step 2: Choose Your Registered Agent
Step 3: Select Your Board Members & Officers
Step 4: Adopt Bylaws & Conflict of Interest Policy
Step 5: File the Articles of Incorporation
Step 6: Get an EIN
Step 7: Apply for 501c3

Recommended: Start your nonprofit with Northwest for just $29 + state fees
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Starting a 501c3 Nonprofit in Vermont Is Easy

As someone getting ready to open your own nonprofit in Vermont, it can be helpful to learn about what others do in this area of business. Vermont is a relatively small state, which is why there are only 6,343 nonprofit organizations within it. However, nonprofits still provide plenty of employment, supporting over 80,102 jobs.

The area with the most nonprofits is Burlington, Vermont. There, you’ll find approximately 1,917 nonprofits that bring in around $3.5 billion in revenue. 

Major employers in Vermont include:

  • The University of Vermont Medical Center
  • Middlebury College
  • Norwich University
  • Central Vermont Medical Center

In general, you’ll find that the largest employers tend to be colleges, community clinics, community mental health centers, general hospitals, and universities. 

Now, looking at revenue, similar businesses tend to bring in the most money. The highest-earning organizations are usually universities, community mental health centers, managed care organizations, colleges, and general hospitals. 

Some of those include:

  • The University of Vermont Health Network Medical Group
  • Middlebury College
  • Central Vermont Medical Center
  • The University of Vermont Medical Center

Only 16 of the nonprofits in Vermont are responsible for bringing in $100 million or more in revenue annually. Another 35 bring in between $25 million and $100 million. 

The most common nonprofits are educational institutions, those in the arts, culture, and humanities, and recreation, sports, and social clubs. The least common are social science, medical, and scientific research organizations. Disease-focused nonprofits are also uncommon, as are civil rights and social justice organizations. Why does that matter?

If you want to help an underserved area, you may want to consider one of those industries for your nonprofit.

To start a 501c3 tax-exempt nonprofit organization in Vermont, you must first start a nonprofit in Vermont according to the rules of the state and then apply for 501c3 status with the IRS.

Learn more about 501c3 eligibility in our What Is a 501c3 guide.

Want to form a nonprofit elsewhere? Check out our other How to Start a Nonprofit guides. Also, check out our best nonprofit formation services review.

Step 1: Name Your Vermont Nonprofit

Before you can open your nonprofit, it’s time to name it. This is the first step, and it’s one that has to follow specific Vermont naming guidelines. Note that you’ll want to choose a name that is easy for donors and potential members to search for and remember.

For more detailed guidelines, check out our How to Name a Nonprofit in Vermont guide.

1. Follow the naming guidelines for the state:

  • Your organization’s name has to include one of the following:
    • Corporation
    • Company
    • Limited
    • Corp. 
    • Co.
    • Ltd.
  • You cannot use the word “cooperative” in your name.

There are more official guidelines for you to review on the Vermont General Assembly website.

2. Can you use the name in Vermont? Do a name search on the State of Vermont website to ensure the name you want is still available. 

3. Can you use the URL? You need to get the web domain for your new business name. Although you might not be interested in making a website now, you’ll want this URL if you ever decide to build one. Buying the URL prevents other businesses from taking it, too.

After selecting a name and buying the URL, you can choose a professional organization to help you complete the Vermont nonprofit formation process. We recommend working with:

Northwest ($29 + State Fees)

Step 2: Choose a Registered Agent in Vermont

Your nonprofit must nominate and select a Vermont registered agent.

What is a registered agent? Your registered agent is an individual or organization that serves as the contact between your organization and the state. They receive legal documents on your business’s behalf.

Who can you choose as your registered agent? A registered agent service, resident of Vermont, a corporation in Vermont, you, or a colleague at your nonprofit may be the registered agent for it.

Learn more about choosing, electing, and changing agents on our How to Choose a Registered Agent for Your Vermont Nonprofit page.

Step 3: Select your Directors & Officers

The directors of an organization come together to form a board of directors. This board of directors is responsible for overseeing the operations of the nonprofit. 

The president, secretary, and other members of the nonprofit who have individual responsibilities and authorities are known as officers

While Vermont only requires nonprofit corporations to have at least one board member, the IRS requires nonprofits to have at least three directors to be eligible for 501c3 status. The majority of directors should not be related to each other.

Unless otherwise noted in the bylaws, Vermont requires that the nonprofit’s officers include:

  • A president
  • A secretary
  • A treasurer

Except for the president and secretary positions, officers can hold multiple titles if the bylaws allow for it.

To learn more about electing a Vermont nonprofit board of directors, read our full guide.

Step 4: Adopt Bylaws & Conflict of Interest Policy

Next, to become eligible for your 501c3 status, you will need to create bylaws for your organization. These are rules that outline how your nonprofit will operate. 

On top of those bylaws, you’ll also need a conflict of interest policy that establishes rules your board of directors and officers must follow. This policy makes sure those in charge don’t act in their own interests rather than doing what’s in the best interests of the nonprofit.

TIP: Your conflict of interest policy and bylaws must be adopted during your first organizational meeting. You’ll also select and swear in your board of directors and officers at that time. 

Step 5: File the Vermont Articles of Incorporation

To register your nonprofit, you will need to file the Articles of Incorporation with the State of Vermont. 

To ensure that your nonprofit is eligible to apply for 501c3 status, in the Articles of Incorporation you must explicitly state the following:

1. Purpose:

In order to qualify for 501c3 status, the organization’s purpose must explicitly be limited to one or more of the following:

Charitable, Religious, Scientific, Educational, Literary, Fostering national/international amateur sports competition, Preventing cruelty to animals/children, Testing for public safety

2. Dissolution:

You must explicitly state what the assets of the organization will be used for, and what will happen to the assets if the organization is dissolved. 

To be eligible for 501c3 status,  the assets of your organization must only ever be used for purposes approved under section 501c3. 

Section 5 of this sample IRS document provides an example of these provisions required for 501c3 eligibility. 

File the Articles of Incorporation

OPTION 1: File Online With the Vermont Secretary of State

File Online

– OR –

OPTION 2: File Form CORP-1(N) by Mail or In Person

Download Form

After requesting the Articles of Incorporation, the Secretary of State will email you a PDF form.

State Filing Cost: $125

Filing Address:
Vermont Secretary of State
Corporations Division
128 State Street
Montpelier, VT 05633-1104

To learn more, read our How to File Nonprofit Articles of Incorporation in Vermont guide.

Step 6: Get an EIN

Your next step is to get an EIN, which stands for “Employer Identification Number.” 

What is an EIN? An EIN, sometimes called a Federal Tax Identification Number, is a number used by the federal government to identify your business entity. Think of it like a Social Security number for your organization. You need an EIN to open a bank account, pay taxes, or hire employees for your nonprofit.

How to get an EIN — To apply for an EIN, you can contact the IRS by mail or online after you form your nonprofit. There is no cost to apply. Read our EIN Lookup guide to find out more.

Step 7: Apply for 501c3 Status

Before a nonprofit can apply for 501c3 status it must, 

  1. Elect at least 3 directors not related to each other
  2. File the Articles of Incorporation with the required provisions (As covered in Step 5)
  3. Adopt the bylaws and conflict of interest policy
  4. Have an EIN number

Once these four conditions have been met your nonprofit can apply for 501c3 tax-exempt status by filing Form-1023 online. 

If your application is approved, the IRS will send you a determination letter stating that your organization is exempt from federal taxes under section 501c3. 

See if your nonprofit has 501c3 status in Vermont. Use our Vermont 501c3 lookup table to find all Vermont nonprofits.

FAQ: Starting Your Nonprofit

When should an organization apply for federal tax exemption?

Form 1023 must be filed within 27 months from the end of the first month your organization was created.

How long will it take for the IRS to process Form 1023/1023-EZ?

Soon after sending your application you should receive an acknowledgment of receipt of your application. 

If your application is simple and complete, IRS will send your determination letter within 180 days for Form 1023

If you have not heard from them by that time you can call (877) 829-5500 to inquire about your application. 

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