By-Laws

Arts service organizations should have printed by-laws that meet with state and federal regulations. By-laws establish how an organization shall be governed.

The by-laws of arts organizations should include:

the name of the organization;
purpose;
membership;
voting;
annual meeting;
board of directors (number and method of selection);
other officers;
terms of office;
powers;
meeting and voting;
duties and responsibilities;
committees (executive, resource development, nominating, fund-raising, etc.);
fiscal year audit;
financial reports;
annual report;
other reports;
indemnification;
amendments.

Model by-laws may be used as a guide, but are adapted to local preferences and requirements. It is essential to have by-laws reviewed by an informed attorney to insure that state and federal regulations for not-for-profit, tax-exempt organizations have been met.

Incorporation

Arts organizations should be incorporated in New York State. Any organization desiring tax-exempt status from the Internal Revenue Service must incorporate as a not-for-profit organization (usually under Section 501 (c) (3) of the IRS Code and file incorporation papers at the state capitol. These papers should be in the name of the corporation and should include:

The name of the corporation.
Location of the principal offices.
Purpose of the organization.
A clause defining the membership and board of directors.
A clause stating that in the event of dissolution of the organization, assets will be given to another not-for-profit tax-exempt organization.
Two or three standard clauses necessary for obtaining tax-exempt status from the IRS.
A list of the original incorporators.

Resources

Foundation Center Learning Lab

Charity Status

Arts organizations should comply with the rules and regulations of the Office of Charities Registration, New York State Department of State. Upon its formation, an arts organization must file a registration statement with the Office of Charities Registration, New York State Department of State. The organization also files a yearly report with the Office of Charities Registration according to law.

Tax Exempt Status

Not-for-profit arts organizations are tax exempt. Tax exemption from the IRS requires an accompanying financial statement for the past year's operation. No statement is required if the organization has been in existence less than eight months. Based on information submitted, a new organization may be qualified to operate as a for its first two fiscal years, pending final review of its financial statements at the end of the two-year period.

Resources

Internal Revenue Service: "FAQs Regarding Applying for Tax-Exemption"
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