Starting A Family Nonprofit

Have you and your family talked about doing something meaningful together—like starting a nonprofit to help your community or support a cause close to your hearts? Starting a family nonprofit is a powerful way to build a legacy, make a real difference, and strengthen your family bond through purpose.

Here’s a simple breakdown to help you understand what it takes to get started.

What Is a Family Nonprofit?

A family nonprofit is a charitable organization founded and often operated by family members. Whether you’re passionate about feeding the homeless, providing scholarships, or honoring a loved one’s memory, your family nonprofit must follow legal guidelines just like any other 501(c)(3) organization.

Real Talk:

Even though it’s a family effort, it still has to operate with professionalism and transparency to be successful—and to qualify for tax-exempt status with the IRS.

Step 1: Define the Mission and Purpose

What does your family want to accomplish? Be specific.

Instead of:

"We want to help people."

Try:

"Our nonprofit will provide monthly grocery boxes to low-income families in Atlanta."

Make sure your mission is:

• Clear

• Measurable

• Focused on public benefit (not just your family)

Step 2: Choose the Right Board Members

Even though it’s a family-run nonprofit, you still need to form a Board of Directors. Most states (and the IRS) prefer at least 3 unrelated board members, but they don’t always require it.

Tip: If using family, choose members who bring different skills:

• One who understands finances

• One with nonprofit or community experience

• One good at organization or planning
  
  

Important: The board must make decisions that benefit the nonprofit—not the family personally.

Step 3: File Your Paperwork

This part may sound intimidating, but it’s manageable with the right help.

You’ll need to:

1. Choose a name for your nonprofit

2. Register your nonprofit with the state

3. Create bylaws (rules for how your nonprofit will run)

4. Get an EIN (Employer Identification Number)

5. File Form 1023 or 1023-EZ to apply for 501(c)(3) tax-exempt status

Don’t worry—our team at www.501c3-nonprofit.org can help guide you through each step.

Step 4: Fundraising and Finances

You can’t use your own family bank account for nonprofit funds. You’ll need to open a separate business checking account and keep good records.

Ways to fund your mission:

• Host family-led fundraisers

• Ask for donations from friends and supporters

• Apply for small grants (once you’re approved by the IRS)

Step 5: Stay Compliant

Once you’re up and running, there are a few ongoing requirements:

• File an annual 990 form with the IRS

• Keep meeting minutes from board meetings

• Report major changes to the IRS and your state

• Follow your bylaws and mission closely

Final Thoughts

Starting a family nonprofit can be one of the most rewarding things you’ll ever do together. Just remember—it takes heart, planning, and a clear understanding of the responsibilities involved.

If your family is ready to create a legacy of giving, we’re here to support you every step of the way.

👉 Visit www.501c3-nonprofit.org to schedule your consultati

About the author:
Trina Newby is a Business and Nonprofit Consultant with more than 20 years experience and is owner of My Nonprofit Startup. She has a passion for helping new founders to start and grow their nonprofit organizations and has facilitated many nonprofit seminars.  She is founder of Women About Biz, a business startup and growth network for Christian women and host of the Successful Woman Radio Show

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