How to start a nonprofit in Alabama

How to start a nonprofit in Alabama, step by step

1. Name your Alabama nonprofit

   Alabama nonprofits need no corporate ending: the name is not required to include Corporation, Incorporated or an abbreviation, which is the opposite of the rule for Alabama business corporations. Reservation is not optional though. It costs $25 by mail or $27.75 online with a card, and the certificate must be attached to your formation documents.

2. Choose your first board of directors

   Plan on at least three people who are not related to each other. Some states allow fewer on paper, but three unrelated directors is what the IRS application works best with, and what funders expect. Pick people who will actually show up.

3. File your Certificate of Incorporation (domestic nonprofit)

   File the Domestic Nonprofit Corporation Certificate of Incorporation directly with the Secretary of State, sending the original and one copy along with your Certificate of Name Reservation. The fee is $200. Filing electronically avoids the $100 expedite fee that paper filers may pay, which Alabama removed for online filings in 2020.

4. Name your registered agent

   Alabama requires a registered agent with a registered office at an Alabama street address, not a post office box, and the filing asks for the county the registered office sits in as well as a mailing address if different.

5. Adopt bylaws and hold your first board meeting

   Bylaws are your internal rulebook: how directors are chosen, how votes work, what officers you have. At the first meeting the board adopts them, elects officers, and approves opening a bank account. Keep minutes; they are your first governance record.

6. Get your free EIN

   It is free from the IRS; any site charging for an EIN is reselling a free thing. Apply online if your responsible party has an SSN or ITIN and your principal place of business is in the US. It takes minutes. Three limits to know: one EIN per responsible party per day, the tool is not open around the clock, and it times out after 15 minutes with nothing saved. Without an SSN or ITIN you file Form SS-4 by fax or mail instead, which takes weeks. You need the EIN for the bank account and every filing after this.

7. Apply for 501(c)(3) status with the IRS

   Two forms, two fees. The short Form 1023-EZ has a $275 user fee, but you may use it only if you clear the whole Eligibility Worksheet. That means three things. Gross receipts did not exceed $50,000 in any of the past three years. They are not projected to exceed $50,000 in any of the next three years. And total assets are $250,000 or less. Churches, schools, hospitals and a few other types cannot use it at all. Everyone else files the full Form 1023, $600. This is the step that makes donations tax-deductible. The IRS currently issues 80 percent of 1023-EZ decisions within about 22 days and 80 percent of full 1023 decisions within about 191 days. It publishes current figures on its status page. Fees read 1 September 2026.

8. Handle Alabama taxes

   Income tax is easy and sales tax is not. Organizations exempt under 26 U.S.C. 501(a) are not required to file Alabama corporation income tax returns while that status holds, and are outside the Business Privilege Tax; file Form 20C with a copy of federal Form 990-T if you have unrelated business income. For sales tax, a 501(c)(3) letter buys nothing: the Department of Revenue says a nonprofit must be specifically listed in Title 40, Chapter 9 of the Alabama Code to be exempt. If yours is, apply on Form ST: EX-A1-SE.

9. Register to fundraise

   Register with the Attorney General's office before soliciting, using the Charitable Organization Registration Form. It costs $25 initially and $25 for each annual filing, due within 90 days of the close of your fiscal year, with a 180-day extension available on request. Organizations that neither intend to receive nor actually receive more than $25,000 in contributions in a fiscal year are exempt, and have 30 days to register once they cross it.

10. Stay in good standing

    There is no Secretary of State annual report for Alabama nonprofits; the annual report line is for domestic for-profit corporations, and 501(a) organizations are outside the Business Privilege Tax return it accompanies. The recurring obligation is the Attorney General renewal at $25, within 90 days of fiscal year end.

Alabama-specific things to know

1. The probate judge instructions are obsolete

   The Secretary of State's site still hosts a 2011 form telling you to file with the county Judge of Probate at $100. That path is superseded. File directly with the Secretary of State at $200 using the current form, or lose a filing cycle.

2. Name reservation is a prerequisite, not a nicety

   You cannot file formation documents without the Certificate of Name Reservation attached. Budget $225 minimum, and get the reservation done first.

3. Federal exemption does nothing for Alabama sales tax

   The Department of Revenue is explicit: a nonprofit is exempt only if it is specifically listed in the statute. Most ordinary charities are not, and pay sales tax on their purchases.

General information for people starting a nonprofit in Alabama, not legal or tax advice. Rules change and fees are updated; confirm specifics with the Alabama offices named on this page, the IRS, or a qualified professional before you file.

The Ember tool for this

Ember Spark

Spark walks you from idea to real nonprofit: bylaws, board resolution, and IRS paperwork drafted for you, free, one step at a time.

Sources: Alabama SOS domestic corporations; Alabama SOS fee schedule; Alabama AG charitable organizations; Alabama DOR on nonprofit sales tax. Read 1 September 2026.