How to Start a Nonprofit in California

California has more charities than any other state and approves more of them: 177,511 active 501(c)(3) organizations, 13,332 of them approved in the last twelve months. That is 10.8% of the country’s charities and 11.2% of its new approvals. 75.9% report no revenue on file or under $50,000, so the organization you are about to form has a great deal of company and most of that company is very small.

The federal half of this is identical in every state and is set out on the state hub: incorporate, adopt bylaws, get an EIN, apply to the IRS on Form 1023 or 1023-EZ. This page covers what California adds, what each step costs, and the two or three things that catch people out here specifically.

What it costs in California

The state filings come to $100 in cash. On top of that sits the IRS user fee, which is set each year by revenue procedure and shown on Pay.gov when you file, so no figure for it is printed here. Every amount above was read from the issuing agency’s own fee schedule or form, and each one is linked in the sources at the foot of this page. Fees change: check before you budget.

The order to do it in

Sequence matters more than speed. The IRS application asks for documents the state has to create first, and the state charity regulator wants the organization to exist before it registers.

• Decide whether you need a corporation at all. Fiscal sponsorship gives a project the same tax treatment with no incorporation, no IRS application and no annual return. For a project under a few thousand dollars a year it is usually the better answer.
• File the formation document with the California Secretary of State, with the IRS purpose and dissolution language in it. Our articles template carries both.
• Adopt bylaws and appoint the board before the IRS application, which asks about governance. The bylaws template and the board guide cover what that means in practice.
• Get an EIN. Free, online, immediate, and needed for the bank account. Do not pay anyone for it: the EIN guide explains why people do.
• Apply to the IRS on Form 1023-EZ if you qualify, which most new organizations do, or the long Form 1023 if you project gross receipts over $50,000 or hold assets over $250,000.
• Handle the state exemptions and registrations in the section below, once the determination letter arrives.

What catches people out in California

The attorney general registration is the step that is missed. Registration with the Registry of Charities is required within 30 days of first receiving charitable assets, under Government Code section 12585, and assets means any donation, grant, property or contribution of value. It is not triggered by incorporating and it is not part of the IRS application, which is exactly why people miss it. The renewal is Form RRF-1, due four months and fifteen days after the end of the accounting period, with the Form 990 attached once total revenue reaches $50,000.

State tax exemption does not follow the federal letter automatically. The Franchise Tax Board says plainly that an organization must apply to it for exemption. With a federal determination letter in hand the route is Form FTB 3500A, which encloses a copy of that letter. Skipping it leaves a nominally exempt charity exposed to the minimum franchise tax.

Property tax is a third exemption with a third decision maker. The welfare exemption is administered by county assessors and turns on how the property is used rather than on who owns it. It matters most if the organization owns a building and lets any part of it, which is covered in our page on renting out space.

What California’s nonprofit sector looks like

From the IRS Business Master File, which lists every organization whose exemption has not been revoked.

The size column is the one worth sitting with before you file. 75.9% of California’s charities have no revenue figure on file or report under $50,000, against 77.4% nationally. The typical outcome of starting a nonprofit here is a very small organization, which is not an argument against doing it, but it is an argument for choosing the cheap route first and for being honest in the projections on the IRS form. What the whole thing costs, federal and state together, is set out in what it costs to start a nonprofit.

A realistic timeline

Written as weeks rather than as a list, because the waiting is the part people plan badly. Nothing here assumes you pay anyone to do it for you.

1. Week one. Agree the purpose, the name and the first board. Check the name against the Secretary of State’s business search before anything is printed.
2. Week one or two. File the Articles of Incorporation, Form ARTS-PB-501(c)(3), for $30, with the IRS purpose and dissolution clauses included rather than left to the template.
3. Same week. Apply for the EIN online. It is free and issued immediately.
4. Within 90 days of incorporating. File the Statement of Information, Form SI-100, for $20. Diary the next one: it repeats every two years and a missed one carries a penalty.
5. Before accepting a single donation, and within 30 days of the first one. Register with the Attorney General’s Registry of Charities on Form CT-1, for $50.
6. Month one or two. Adopt bylaws, hold the first board meeting, open the bank account, then file Form 1023-EZ if you qualify.
7. When the determination letter arrives. Send Form FTB 3500A to the Franchise Tax Board with a copy of it, and diary the annual RRF-1 for four months and fifteen days after your year end.

The long pole is the IRS, not California. The state end of this is measured in days and costs $100. Everything after the determination letter is either free or a form with a copy of that letter stapled to it.

What kind of charities California has

The Business Master File classifies each organization by activity. The six commonest categories in California account for 96,608 organizations between them:

• Religion related: 25,177 organizations
• Education: 19,739 organizations
• Human services: 16,445 organizations
• Arts, culture and humanities: 14,539 organizations
• Philanthropy and grantmaking: 10,983 organizations
• Recreation and sports: 9,725 organizations

That mix is worth checking against what you are planning. The largest category in every state is religion related, which is a reporting artifact as much as a fact, since churches are exempt automatically and many register anyway. The categories underneath it are the real map of what gets funded locally, and an organization entering a crowded category needs a sharper answer to the question of why it should exist separately than one entering a thin one.

Approvals in California are rising

The file carries a determination date for every organization, so the last two years can be compared directly. California had 13,332 approvals in the last twelve months against 13,125 in the twelve before that, a change of +1.6%. Nationally the last twelve months produced 119,025.

Read that as competitive context rather than as a verdict. More approvals means more organizations chasing the same local funders, and it also means the process is working normally for people like you. What it does not tell you is how many of them are still operating in three years, which the file cannot say, because it keeps listing an organization until its exemption is actually revoked.

After approval

The annual obligations start immediately and they run on two calendars. Federally, a return is due every year from the first full tax year, and three consecutive misses means automatic revocation with no appeal: which return applies is covered in which Form 990 you file. In California, the filings in the table above renew on their own cycle. If the organization eventually sells anything or lets space, selling products and renting out space cover the tax treatment, and if it does not work out, closing properly is its own process.

Method and sources

Every fee and form on this page was read from the issuing agency’s own page or form on 30 September 2026, listed in the sources below. Nothing here is copied from another guide. The IRS user fee is not stated because the form instructions point to a revenue procedure and to Pay.gov rather than printing an amount.

The counts are from the IRS Exempt Organizations Business Master File, filtered to subsection 03, with determinations through August 2026. Three limits carry over from that file: it includes organizations that are dormant but not yet auto revoked, the ruling date is when the IRS decided rather than when anyone applied, and revenue is blank for most small organizations, which is why the size row reads “no revenue on file or under $50,000” rather than giving a median. State is the organization’s own mailing address. This page is general information and not legal advice.

This is reference information, not legal or tax advice. Rules vary by state and change over time. For a decision that carries real consequences, check the current text at irs.gov or your state registry, and talk to a nonprofit attorney or CPA.