There are a few steps you will need to take when dissolving or terminating your 501(c)(3) nonprofit organization, starting with a vote from your board of directors to dissolve the organization.

Before the board of directors makes the important decision to dissolve the organization, they will first need to create a "plan of dissolution," first!

Board members may not be aware of how to dissolve and organization, so the planning may take time. Throughout this process, it is beneficial to have the minimum number of board members required by your bylaws remain on your board to aid the dissolution process.

Much like when the nonprofit was originally formed, you will need to notify your state (typically the Attorney General's office) about your organization's change in status. Whether or not you have assets to distribute will dictate what types of forms you need to file. Each state will have different regulations regarding the filing process. For example, here are the steps involved for dissolving a nonprofit in Illinois. For more information on your own state's regulations regarding dissolution, find your state government's web site.

Finally, you will need to also notify the IRS by filing all required documentation, including a form 990. Learn more about IRS rules regarding dissolution.

See our related Knowledge Base article Where can I find information about collaboration and other kinds of strategic alliances?

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