How to Start a Nonprofit in Connecticut: State Filing, IRS Exemption and Charity Registration

Starting a nonprofit in Connecticut means working through three separate systems, and first-time founders often mix them up. The Secretary of the State forms the corporation. The IRS decides whether it is exempt from federal income tax. The Department of Consumer Protection (DCP) decides whether it may ask the public for donations. Each one has its own forms, fees and timelines, and approval from one does not mean approval from the others. This guide covers the order we recommend, the figures we can verify, and where you need to confirm a number yourself before you pay.

This article is informational, not legal or tax advice. Nonprofit formation involves governance, tax and fundraising rules that depend on your specific facts. Talk to a Connecticut attorney and a CPA before you file, especially if you plan to hold property, hire staff or raise a large amount of money.

What You Are Forming

In Connecticut, a nonprofit corporation is called a nonstock corporation. “Nonstock” means the corporation has no shareholders and no owners who can take a share of profits. Your state paperwork goes to the Connecticut Secretary of the State, Business Services Division, and is filed through the Business.CT.gov portal. A nonstock corporation files a Certificate of Incorporation. It does not file the Certificate of Organization used by LLCs, so do not use LLC forms or LLC fee schedules for this work.

Three tracks follow from forming the corporation, and each one is separate:

• State formation: the Certificate of Incorporation and the Organization and First Report with the Secretary of the State.
• Federal tax exemption: IRS Form 1023 for 501(c)(3) status. This is filed with the IRS, not the state.
• Charity registration: the Solicitation of Charitable Funds Act, CGS 21a-175 to 21a-190l, administered by DCP. Registration is required before you solicit donations unless you qualify for an exemption.

Forming the corporation does not make you tax exempt, and neither one allows you to solicit. DCP states that its registration is unrelated to incorporating or to tax exemption.

What You Need Before You Start

• A name you can use. Check availability free with the Business.CT.gov business records search.
• A Connecticut registered agent. This must be a Connecticut resident age 18 or older, or a business entity registered with the Secretary of the State, with a business address in Connecticut.
• Incorporator information. Names and addresses of the people signing the Certificate of Incorporation.
• Draft bylaws. These set how the board meets, votes and elects officers.
• Initial directors and officers. Names and addresses, which go into the first report.
• A principal office address. A street address where the organization conducts business.
• A federal EIN. Obtained free from the IRS. You will need it for banking and for the IRS application.
• A written mission statement and a first-year budget. The IRS application asks for a description of your activities and financial projections.
• A payment method for online filings, plus your Business.CT.gov account.

Step 1: Check and Reserve Your Name

Search the name on Business.CT.gov before you do anything else. The name must be distinguishable from names already on the state record. Names that suggest a regulated activity, such as bank or insurance, require authorization, so avoid those words unless you have the approval. If you need time to finish your paperwork, you can reserve the name for 120 days for a $60 fee.

If you plan to operate under a name other than your corporate name, such as a program name or a community brand, you will also need a trade name certificate. That is filed with the town clerk, not the Secretary of the State, and is covered in Step 8.

Step 2: Appoint a Registered Agent

Every corporation formed in Connecticut must appoint and continuously maintain a registered agent. The agent receives legal and official correspondence for the organization. Your agent must be either a Connecticut resident who is at least 18, or a business entity registered with the Secretary of the State.

The agent’s address must be a usual place of business in Connecticut that is customarily open during normal business hours with an authorized person present. A post office box or commercial mailbox does not qualify. Many founders use a board member’s office or a commercial registered agent service. Either option works if the address meets these rules. The agent is confirmed and updated each year when you file the annual report, so keep this information current.

Step 3: File the Certificate of Incorporation

File the Certificate of Incorporation for your nonstock corporation through Business.CT.gov, or by mail if you prefer. The Secretary of the State lists a $50 fee for the Certificate of Incorporation. Confirm the amount for your filing method on the fee page before you submit payment, because the state updates its schedule from time to time.

Most filings submitted online are accepted automatically, and the state says expedited service is usually unnecessary. When you want a faster review, the Secretary of the State lists expedited service at $50 per transaction. It is completed within 24 hours and is available only for online filings, not mail. Confirm the current expedited fee on the same portal before you choose it.

Step 4: Adopt Bylaws and Hold the Organizational Meeting

After the state accepts your certificate, hold an organizational meeting. The incorporators or initial directors should adopt bylaws, elect the board and officers, approve the bank account, and authorize the EIN application and the IRS filing. Write minutes for every decision. The IRS and DCP both ask to see governance records, and clean minutes make the later filings easier.

Bylaws deserve careful drafting. Include the number of directors, how they are elected, how officers are chosen, how meetings are called and how conflicts of interest are handled. Many founders also adopt a written conflict-of-interest policy. Ask your attorney whether your bylaws meet both state law and IRS expectations before you adopt them.

Step 5: File the Organization and First Report

After incorporation, file the Organization and First Report with the Secretary of the State. The Secretary of the State lists this filing at $50. The report identifies your initial officers and directors, your registered agent and your principal office. Confirm the exact information the form requires on Business.CT.gov before you file, so the report matches your bylaws and your board roster.

Once filed, the corporation must file an annual report with the Secretary of the State every year. The annual report fee for a nonstock corporation is $50. Business.CT.gov does not publish one flat statewide deadline. Instead, it shows each corporation its own next due date in your account, so check that date as soon as your first report is accepted.

Step 6: Apply for Federal Tax Exemption With IRS Form 1023

Connecticut incorporation does not give you federal tax exemption. You must apply to the IRS separately, usually on Form 1023 for 501(c)(3) status. Some smaller organizations may qualify for the shorter Form 1023-EZ. Check eligibility on IRS.gov before you choose a form.

The IRS reviews your organizing documents, so your certificate and bylaws must contain the purpose and asset-dissolution language the IRS requires. Ask your attorney to compare your documents against current IRS guidance before you submit. The IRS also sets a user fee for the application, and it changes over time. Confirm the current amount on IRS.gov before you pay.

Until the IRS issues a determination letter, donors generally cannot treat their gifts as tax deductible. Tell your early donors that your status is pending, and keep a copy of the letter once you receive it, since you will need it for grant applications, banking and state filings.

Step 7: Register With DCP Before You Solicit

If you plan to ask the public for money, you must register with the Department of Consumer Protection under the Solicitation of Charitable Funds Act, CGS 21a-175 to 21a-190l. This is what the state calls charitable solicitation registration, and it must be in place before you solicit unless your organization qualifies for an exemption.

Some small organizations can claim an exemption. An organization that normally receives less than $50,000 in contributions a year, and that pays no one primarily to solicit, can claim the exemption once on Form CPC-54. The form has no fee. Check with DCP to confirm the current form and whether your situation qualifies, because a wrong claim can leave you out of compliance.

Registered charities file an annual report with DCP, including a Form 990. Organizations above $500,000 in gross receipts must also submit an audit. DCP lists an annual $50 registration fee, and the application includes a financial report for your most recent fiscal year. Confirm the current fee and filing forms with DCP directly before you submit anything.

Step 8: Handle Sales Tax, Trade Names and Local Approvals

Sales tax exemption. Your nonprofit may want to buy supplies without paying sales tax. The Department of Revenue Services (DRS) handles that exemption, and DRS publishes Form CERT-119, the certificate for purchases by qualifying exempt organizations. Check with DRS at portal.ct.gov/drs to confirm whether your organization qualifies and how to obtain and use the certificate before you make tax-exempt purchases.

Sales and Use Tax Permit. A business selling taxable goods or services must obtain a Sales and Use Tax Permit from DRS. The registration fee is $100, and the permit must be displayed at each location. If your nonprofit sells taxable items such as merchandise, ask DRS whether you need a permit even though you are tax exempt.

Trade name. If you operate under a name other than your corporate name, file a Trade Name Certificate with the town clerk of the town where the organization primarily does business. The fee is $20. This is not filed with the Secretary of the State. See business.ct.gov for the trade name guide.

Licenses and approvals. Connecticut has no single general state business license. Registering with the Secretary of the State is a registration, not a license. Licensing depends on the work you do and is issued by agencies such as DCP, the Department of Public Health, the Insurance Department and the Department of Banking. Local zoning, health and occupancy approvals may also apply. Connecticut has no county government, so these approvals come from your town or city, your local health department or district, and the planning region that covers your area.

Step 9: Calendar Your Ongoing Obligations

Your work does not end with the first filings. Put these items on a shared calendar and assign one person to own them:

1. The Secretary of the State annual report, $50, with the due date shown in your Business.CT.gov account.
2. Registered agent confirmation, which happens with each annual report.
3. DCP annual filings, including Form 990, plus an audit if your gross receipts exceed $500,000.
4. IRS annual filing obligations, which you should confirm with your CPA.
5. Renewal of any trade-specific license, permit or local approval you hold.

If you miss the annual report, the Secretary of the State lists reinstatement at $160. Missing filings can also affect your standing with DCP and your eligibility for grants, so keep a copy of every confirmation in your records.

Expected Results

When the steps above are complete, your nonstock corporation may be recognized as a separate legal entity in Connecticut. You may receive an IRS determination letter, which can support tax-deductible donations, grant applications and banking relationships. Your DCP registration or exemption may allow you to solicit donations in compliance with state law. These outcomes depend on accurate filings, timely responses and the specific facts of your organization, so none of them is guaranteed. Plan for the process to take longer than you expect, and treat each agency’s confirmation as the document you keep.

Common Mistakes to Avoid

• Treating incorporation as tax exemption. The state corporation and the IRS exemption are separate. File both.
• Soliciting before you register. Asking for donations before DCP registration or a valid exemption can create compliance problems.
• Using a P.O. box for the registered agent. The address must be a usual place of business in Connecticut.
• Using LLC forms or LLC fees. A nonstock corporation files a Certificate of Incorporation.
• Skipping the organizational meeting. Without minutes, the IRS and DCP have no record of who authorized what.
• Forgetting the trade name. Operating under a program name without a town clerk filing can cause problems with banks and funders.
• Missing the annual report. Late filings lead to reinstatement fees and can delay your other approvals.

Tips From the Filing Desk

• Check the name, reserve it if needed, and save the search result with the date.
• Draft bylaws before you file, then have an attorney compare them with IRS requirements.
• Open a bank account in the corporation’s name only after you have your EIN and the filed certificate.
• Keep one folder, digital or paper, with every confirmation, receipt and determination letter.
• Ask your CPA how donations, grants and any sales tax exemption will be recorded.

Where to Get Help

• Connecticut Secretary of the State, Business Services Division: portal.ct.gov/sots/business-services/bsd
• Business.CT.gov fee schedule and online filings: business.ct.gov/business-services/business-forms-and-fees
• Business records search for name availability: service.ct.gov/business/s/onlinebusinesssearch
• Trade name guidance: business.ct.gov/knowledge-base/articles/trade-names
• Department of Revenue Services: portal.ct.gov/drs
• Connecticut Small Business Development Center, for planning help: ctsbdc.uconn.edu
• IRS, for Form 1023 and user fee information: irs.gov

For anything involving governance, grants, property or employees, work with a Connecticut attorney and a CPA. The fees and procedures in this guide are based on the agency pages available at the time of writing, and agencies change them, so confirm each figure before you pay or file. This article is informational only and is not legal or tax advice.