Get started
This page will help you understand the steps to starting a nonprofit in San Francisco. It is a resource from the Office of Economic and Workforce Development with the Office of Small Business, San Francisco's central point of information for small businesses.
Choose a location
Choose a location
- Determine the type of nonprofit business you are seeking to operate so that you can acquire and complete the appropriate paperwork.
- Note: If your nonprofit is also a business type that requires other special permitting (e.g., food service, retail, etc), you will also have to go through the steps appropriate for establishing that business. Please refer to our other Starter Guides (https://sf.gov/starter-guides-small-businesses) or contact the Office of Small Business permit specialists at sfosb@sfgov.org or 628-652-4949.
- Find a location zoned for your business. Every location is zone differently - some could require a "Change of Use" or "Conditional Use" application, which can include a public hearing and neighborhood notification.
- Contact the SF Planning Department at pic@sfgov.org or visit the Permit Center at 49 South Van Ness Ave to understand zoning requirements for your proposed location. For more information, visit: https://sf.gov/information/zoning-businesses
- Determine if you need to make changes to your space. Before signing a lease, you can speak with the Office of Small Business' permit specialists to help you work with City agencies to understand building code requirements for your space.
- Review Americans with Disabilities Act (ADA) guidelines to make sure your business is accessible. Learn more by visiting: https://sf.gov/information/ada-compliance-business
- Note: Your landlord is require to provide information about the accessibility of the building, in case it needs renovations.
Set up your business
Set up your business
- Evaluate whether setting up your own organization is the right decision. If you anticipate making less than $5,000 per year in revenue, you can accept tax-deductible donations without filing any paperwork. Such entities are unincorporated associations.
- Note: To get to work immediately and complete setting up your own nonprofit later (or forego the paperwork process altogether), fiscal sponsorship may be a viable option. Under this arrangement, a nonprofit entity may operate under the auspices of an existing organization.
- Choose and file a business name. Research your desired names name’s availability in your county before filing. Reserve your nonprofit’s name with the CA Secretary of State. Make sure the name is not the same as or too similar to an existing name on the records of the CA Secretary of State.
- Create articles of incorporation and bylaws for your nonprofit. A nonprofit's bylaws are the internal governing rules that contain rules and procedures for holding meetings, voting on issues, and electing directors and officers. Typically, the bylaws are adopted by the corporation's directors at their first board meeting. CalNonprofits offers guidance on bylaws and specific purpose statements here.
- Establish a board. Many nonprofits find their first board members in the community they are assisting. A nonprofit may be comprised of as few as one director under the California Law. However, IRS is unlikely to grant 501(c)(3) status to a nonprofit with only one director. Online marketplaces like VolunteerMatch are helpful resources for growing your board and rounding out skills and experience.
- Register as a nonprofit corporation. Most nonprofits are 501(c)(3) tax-exempt organizations. To attain this status, the first step is to register with the CA Secretary of State as a California nonprofit corporation and file your Articles of Incorporation. This must be done before registering locally
- File a 1-page Statement of Information with the CA Secretary of State within 90 days of receiving your California Corporate Number (after submitting your Articles of Incorporation). There is a fee for this service.
- Note: If you register your business before choosing a final location, you will have to update your registration with the new address.
- Apply for an Employer Identification Number (EIN), also known as a Federal Tax ID Number from the IRS. This is used to identify your business and allows you to hire employees. If you are a sole proprietor without employees, you may choose to use your Social Security Number instead.
- Note: Inform the IRS that you wish to obtain 501(c)(3) tax-exemption status. The IRS will tell you about Form 1023 which you will need to file. If you expect your organization’s income to be less than $50,000 per year, you will need to file Form 1023-EZ instead.
- Within 30 days of receipt of assets, file Form CT-1 with CA Attorney General’s Registry of Charitable Trusts (oag.ca.gov/charities/forms). This requires Articles of Incorporation and a federal EIN.
- Apply for California Tax-Exempt Status with the California Franchise Tax Board.
- Note: If you complete this step after receiving your federal exemption, file Form 3500A (free). If you have not yet received your exemption, file Form 3500 (for a fee). If you are in a rush to set up your nonprofit and can afford the fee, file Form 3500 concurrently with IRS Form 1023. Otherwise, file form 3500A after receiving your EIN and tax exempt status from the federal government.
- Register your business with the City through the Office of the Treasurer and Tax Collector (TTX) and the Office of the Assessor-Recorder. Avoid paying payroll taxes and registration fees by selecting “Nonprofit” in Section 2 to let San Francisco TTX know your business is an eligible nonprofit.
- Note: While nonprofits are exempt from the registration fee, payroll expense tax, and gross receipts tax, they must still register with the Tax Collector. They are also required to provide proof of their exempt status.
- Resource: The Bar Association of San Francisco’s Community Organization Representation Project (CORP) can assist with free or low-cost legal help as you file.
Prepare your space
Prepare your space
- For new construction: Submit plans and documents to the SF Department of Building Inspection (DBI). Be prepared to work with an architect or designer to create your building project plans.
- View DBI plan specifications at: https://sf.gov/information/create-your-building-project-plans
- Visit DBI's Technical Services Counter at 49 South Van Ness (Permit Center) or email TechQ@sfgov.org for questions about building codes
- Water and wastewater capacity charge: If your business will use more water than the previous business or resident, you may have to pay a capacity charge to the SF Public Utilities Commission (SFPUC).
- Resource: https://sfpuc.org/accounts-services/service-installations/capacity-char…
- Tip: Get an estimate of the water capacity charge from the SFPUC before you sign a lease. This fee can be high, especially if your location was not previously a restaurant.
- Review and sign your lease. Leases are an opportunity for negotiation between you and the property owner. We strongly recommend verifying the zoning of the property before you sign a lease and to review the contract with a lawyer.
- Resource: Community Vision offers free rapid response consultation calls.
- Gas and electric services: If your business needs new or additional gas or electric services, contact PG&E Building and Renovation Services to start the application process.
- Signs: If you want to install or change a canopy or sign on the outside of the building, ensure you comply with Planning Department and DBI sign guidelines.
- Planning Department: https://sfplanning.org/resource/signs
- DBI: https://sf.gov/step-by-step/get-permit-build-sign
- Note: Awning permit fees are waived each year during the month of May. You can qualify if you submit your permit application during the month of May. Ask for the permit fee waiver from Planning Department and DBI.
- Property Tax Exemption: Many nonprofit spaces qualify for a property tax exemption. Some leased property is ineligible unless both the owner and operator file and qualify.
After opening
After opening
- Post all required posters and permits including, but not limited to, No Smoking signs, minimum wage information, and health inspection results
- Mark your calendar. Set reminders to renew your permits and licenses as needed.
- Prepare and pay your local, state, and federal taxes. Learn more from these departments:
- Review nonprofit resources periodically at the Office of Economic & Workforce Development's website. The website is updated with resources for funding, board governance, long-term sustainability and more.