To start a nonprofit in Colorado, you file articles of incorporation with the Colorado Secretary of State for $50, get an Employer Identification Number from the IRS, and then apply separately for federal 501(c)(3) tax-exempt status using either Form 1023 or Form 1023-EZ. After the IRS issues your determination letter, you handle Colorado’s own sales tax exemption and register with the state before soliciting donations. The state filing takes minutes online. The federal piece can take anywhere from about three weeks to roughly six months depending on which IRS form you qualify to use.
Pick a Name and a Registered Agent
Your nonprofit’s name has to be distinguishable from every other entity already on file with the Secretary of State. Run the name through the Secretary of State’s name availability search before you file; if it’s taken, pick something else.1Colorado Secretary of State. Name Availability Search – Tips
You also need a registered agent in Colorado. The agent receives legal documents and official mail for the nonprofit. It can be an individual who is at least 18 and lives or works primarily in Colorado, or a business entity authorized to operate in the state.2Justia. Colorado Revised Statutes Section 7-90-701 – Registered Agent – Definition You can act as your own agent if you meet those conditions. Commercial services generally run $49 to $300 a year.
File Articles of Incorporation
The articles are the document that actually creates your nonprofit. Colorado requires them to include the corporation’s name, the mailing address of its principal office, and the true name and mailing address of each incorporator. You may list your initial board of directors, but the statute says you “may but need not” do so.3Justia. Colorado Revised Statutes Section 7-122-102 – Articles of Incorporation
File online through the Secretary of State’s business portal.4Colorado Secretary of State. File a Business Document The system prompts you for the name, registered agent, principal office, and incorporator information, and asks whether the corporation will have members. The fee is $50, paid by credit card or from a pre-funded state account. Most filings are processed within minutes, and you can immediately download a filed document summary.
Add the IRS Language Before You File
If you intend to apply for 501(c)(3) status, two provisions must appear in the articles themselves. The IRS will not accept them from your bylaws alone.5Internal Revenue Service. Publication 557 – Tax-Exempt Status for Your Organization Put them in the “Additional Information” field during the online filing.
The first is a purpose clause stating that the corporation is organized exclusively for one or more exempt purposes — charitable, religious, educational, or scientific — within the meaning of Section 501(c)(3). The second is a dissolution clause stating that if the corporation dissolves, any remaining assets go to another tax-exempt organization or a government entity for a public purpose, not to any private individual.6Internal Revenue Service. Suggested Language for Corporations and Associations per Publication 557
The IRS also expects the articles to bar certain activities: no distribution of earnings to private individuals, no substantial lobbying, and no participation in political campaigns for or against candidates.6Internal Revenue Service. Suggested Language for Corporations and Associations per Publication 557 The agency publishes sample wording for all of these clauses in Publication 557. Tracking that sample language closely is the safest route; vague or overly broad purpose statements can get your exemption application denied.5Internal Revenue Service. Publication 557 – Tax-Exempt Status for Your Organization
Adopt Bylaws and Basic Governance
Bylaws are the internal rulebook: how the board is elected, when it meets, what officers do, how many directors make a quorum, and how the bylaws themselves can be amended. Colorado law lets the board of directors adopt the initial bylaws, or the incorporators if no directors have been named yet.7Justia. Colorado Revised Statutes Section 7-122-106 – Bylaws Bylaws aren’t filed with any state agency, but you’ll need them for the IRS application and for banks and funders.
Colorado technically requires only one director. Three unrelated directors is the widely recommended practice, and the IRS looks for it when it reviews exemption applications.8Internal Revenue Service. Governance and Tax-Exempt Organizations
Adopt a conflict of interest policy at the same time. It requires directors and officers to disclose any personal financial stake in a transaction with the nonprofit and to step aside from the decision. Form 1023 asks about it directly.
Some records should be kept permanently: your articles of incorporation, bylaws and amendments, board meeting minutes, your IRS exemption application, and the determination letter when it arrives.
Get an Employer Identification Number
Before applying for tax-exempt status, you need an EIN from the IRS. It’s a nine-digit number that works like a Social Security number for the organization and is required for tax filings, opening a bank account, and hiring staff.9Internal Revenue Service. Employer Identification Number
Apply online through the IRS website at no cost. The IRS recommends forming the entity with the state first, because applying out of order can delay issuance.10Internal Revenue Service. Get an Employer Identification Number The online application issues the EIN immediately on completion.
Apply for 501(c)(3) Status
Federal tax exemption is not automatic. You apply for it by filing Form 1023 or the streamlined Form 1023-EZ. Both are submitted electronically through Pay.gov.11Internal Revenue Service. Applying for Tax Exempt Status
Which Form, and What It Costs
Smaller organizations may qualify for Form 1023-EZ if they meet every item on the IRS eligibility worksheet. The two main thresholds: annual gross receipts have not exceeded, and are not projected to exceed, $50,000 in any of the past or next three years, and total assets do not exceed $250,000.12Internal Revenue Service. Instructions for Form 1023-EZ The user fee for Form 1023-EZ is $275.13Internal Revenue Service. Form 1023 and 1023-EZ Amount of User Fee
If you don’t qualify for the EZ, you file the full Form 1023 at a user fee of $600.13Internal Revenue Service. Form 1023 and 1023-EZ Amount of User Fee The full form requires a detailed narrative of each activity — what it is, who conducts it, where and when it happens, how it furthers your exempt purpose, what share of your time it represents, and how it’s funded — plus financial projections and supporting documents.14Internal Revenue Service. Form 1023 Detail Required in Narrative Description of Activities
How Long It Takes
As of early 2026, the IRS issues 80% of Form 1023-EZ determinations within about 22 days. The full Form 1023 takes much longer: about 191 days for 80% of applications.15Internal Revenue Service. Where’s My Application for Tax-Exempt Status Applications flagged for review take even longer. Approval comes as a determination letter — keep it permanently, because you’ll need it for state exemptions, grants, and donor substantiation.
Public Charity or Private Foundation
Every 501(c)(3) is classified as one or the other. The IRS presumes private foundation status unless you request and qualify as a public charity.16Internal Revenue Service. EO Operational Requirements Private Foundations and Public Charities Private foundations face stricter operating rules and excise taxes, so most new organizations want public charity status. You indicate the classification you’re seeking on your 1023 or 1023-EZ. Churches, schools, and hospitals qualify as public charities automatically; most others qualify based on receiving broad public support.17Internal Revenue Service. Exempt Organizations Annual Reporting Requirements – Form 990, Schedules A and B Public Charity Support Test
Handle Colorado After the Determination Letter
Colorado Sales Tax Exemption
Federal 501(c)(3) status does not exempt your nonprofit from Colorado sales tax. You apply separately to the Colorado Department of Revenue using Form DR 0715, with your IRS determination letter attached. There is no fee, and the certificate doesn’t expire once issued.18Department of Revenue – Taxation. Certificates of Exemption The exemption number you receive will start with 98 or 098, and you give it to vendors to avoid state sales tax on qualifying purchases.
Charitable Solicitation Registration
If you plan to ask the public for donations in Colorado, register with the Secretary of State under the Charitable Solicitations Act before you start fundraising. Registration is required for any charitable organization that intends to solicit contributions in the state and must be renewed every year, with fines for late renewals.19Colorado Revised Statutes. Colorado Code 6-16-104 – Charitable Organizations Initial Registration Annual Filing Fees If you fundraise online, other states may require their own registration before you solicit their residents.
Keep the Status You Just Earned
Every tax-exempt organization has to file an annual information return with the IRS. The form depends on size: Form 990-N (the e-Postcard) for gross receipts of $50,000 or less; Form 990-EZ for gross receipts under $200,000 and total assets under $500,000; and the full Form 990 for gross receipts of $200,000 or more, or total assets of $500,000 or more.20Internal Revenue Service. Instructions for Form 990 Return of Organization Exempt From Income Tax
Miss the filing three years in a row and the IRS automatically revokes your exempt status with no warning and no grace period. The only way back is to reapply from scratch.21Internal Revenue Service. Automatic Revocation of Exemption for Non-Filing Frequently Asked Questions Even a single late filing brings penalties of $20 per day, capped at the lesser of $10,500 or 5% of gross receipts for smaller organizations.22Internal Revenue Service.