BlogOrganizational Management Nonprofit Bylaws 101: How to Write Bylaws for Your Organization Organizational Management Nonprofit Bylaws 101: How to Write Bylaws for Your Organization Author: Sonia Urlando July 19, 2022 Contents 🕑 10 min read Over the years, your nonprofit is bound to grow and change! Nonprofit bylaws help to remove uncertainty from those changes by starting your nonprofit from a solid foundation. But what are bylaws for a nonprofit in the first place? If you’ve never worked with them before, nonprofit bylaws can look like a whole lot of legal jargon. But no need to fear! We’ve broken bylaws down for you in an easy-to-understand guide. What are Nonprofit Bylaws? Nonprofit bylaws are a document which serves as a guidebook for your internal affairs. Said simply: they’re an operating manual for your nonprofit! They cover procedures and guidelines like: Duties and roles of directors and officers Elections procedures Setting up meetings Quorum requirements Membership structure Conflict of interest policies and procedures These bylaws also typically follow a specific structure, which we’ll go over in our nonprofit bylaws template! And What’s the Purpose of Bylaws for Nonprofits Anyway? The purpose of bylaws for nonprofits is to offer basic guidance for how the board should act in different situations. When conflict or confusion arise, bylaws give you tools for resolution. Instead of coming up with solutions from scratch, you have a premade guide on what to do! According to the IRS, bylaws are the “internal operating rules of an organization.” Even though they don’t need to be filed with the State, nonprofit bylaws are also essential if you want to get the 501(3)(c) exemption. How to Write Nonprofit Bylaws in 7 Simple Steps If you want to learn how to write bylaws for a nonprofit, here are seven simple steps to get you started: Decide Whose Responsibility it is Often nonprofit board bylaws are written by the board itself. Board members have a good idea of what issues may arise, and how it might make sense to problem-solve. Another great option is setting up a bylaw committee! This strategy takes multiple perspectives into consideration, so it’s easier to meet peoples’ needs across your whole organization. Research Bylaw Requirements for Your Type of Nonprofit Laws vary from state to state, so be sure to do your research on your state’s particular nonprofit corporation act. If any provisions in your bylaws are in contradiction to your state laws, they’ll ultimately have no power. To be straightforward: bylaws have to be legal! Create a First Draft Don’t try to start out with a perfect document! Bylaws cover many different aspects of your organization, so it makes sense not to know everything at the start. Consult some sample nonprofit bylaws for reference, and then… Review Your Draft Internally The more eyes you get on the draft of your nonprofit bylaws, the less likely you are to miss something important. Nobody knows what it’s like to be in every single role within your organization, and we all know what happens when you assume! The bylaws should serve your nonprofit as a whole. Manage the Scope of What’s Included Your bylaws are made to cover a lot of ground, but there is such a thing as going overboard. If your bylaws are overly specific, you might find yourself accidentally violating them. For example, if your bylaws state that board meetings must be held Mondays at 10AM, you’d need to amend your bylaws if you wanted to change the date—or even the time! This is where it helps to know the difference between a policy manual and nonprofit bylaws. A policy manual creates guidelines which are ultimately flexible, whereas bylaws are hard rules. Just think—if you had to amend your bylaws every time a job description shifted, it would be a huge hassle. If something changes frequently, it’s best not to include it in your bylaws! Get a Professional Opinion If you’re not super familiar with the ins and outs of legal language, it’s a good idea to get some help from a qualified professional. Just be sure they have experience with nonprofits specifically. If you can budget for a corporate lawyer, it’s less likely that you’ll run into bylaw trouble in the future. They can even offer you support when the time comes to make amendments! But don’t worry—the final say on what bylaws you adopt is in the hands of your board. Review Review Review! The best bylaws reflect the active state of your organization. They should give an accurate look at what your nonprofit is doing right now, not what you thought it might do when you first started. Make sure that you work processes into your organization that let you review and renew your nonprofit’s bylaws! Your Nonprofit Bylaws Checklist: What to Include + Free Template Here is a typical checklist for what you should include in your nonprofit’s bylaws: Name: Use the official name that’s in your Articles of Incorporation. Address: This shows where you store your corporate records. Purpose of Corporation: Knowing your purpose is majorly important if you want 501(3)(c) status! Here are some sample purposes from the IRS. Board of Directors: Be sure to include what powers the board has, the number of officers there should be, term limits, the process and conditions of removal, compensation (if any!), and what qualifications are needed. Board Officers: Here you lay out the roles themselves (President, Vice-President, Treasurer, Secretary, etc.) and the board’s responsibilities. Committees: If you choose to have committees, include information about what they do, when they should meet, the number of members involved, and any rights they have. Giving the board control over their creation and dissolution can save you time and amendments in the future. Meeting Guidelines and Voting Procedures: Lay out what makes a meeting possible! Make sure to note what kinds of meetings there are, how often they’ll be held, the number of people you need for quorum, and the number of votes necessary to pass an initiative. Membership: Note what membership eligibility looks like, if there are tiers, what the dues will be, how you’ll manage voting rights, and how you’ll handle termination. This will give you extra clarity as you establish your member management system! Bookkeeping & Misc: This section covers how your nonprofit will manage its accounting. For example, will you be operating within a calendar or fiscal year? You’ll also note the requirements around keeping records such as board meeting minutes. Conflict of Interest Policy: Conflicts of interest can lead to some sticky situations, so be sure to define them clearly. You should also include procedures for handling conflicts of interest as they arise. This is a complex area, so it might be worth putting it into a separate document—just be sure to note that in your bylaws. Control Provisions: No one person owns a nonprofit, but it is important to place the final word somewhere! Does it go to the board of directors or someone separate? Amendment of Bylaws: Decide your policy for making amendments. Who do you want to approve them, and what percentage of a vote is necessary to make it happen? Do your best to make this process simple! Dissolution of the Organization: If your nonprofit’s time comes to an end, you’re required to have a pre-made plan for how your assets will be distributed. It often makes sense to have assets go to a similarly-aligned charitable organization. Any Specific Rules for your Nonprofit’s Specific Needs: Every nonprofit works differently! If there’s anything missing from these bylaws that you think is important to regulate, be sure to make a section that covers your bases. We’ve created a downloadable version of this checklist for you to share with your board members. Get your copy and make sure your entire board is on the same page while you create your nonprofit bylaws. Download The Checklist Nonprofit Bylaws: An FAQ With all of the work that goes into writing your bylaws, it’s natural to have some questions. Let’s cover some of the basics: Are nonprofit bylaws public record? No, nonprofit bylaws are not public record. However, making them available to the public is a great way to foster transparency between you and your donors. People trust an organization that keeps itself publicly accountable to its mission and values. Making your bylaws public record is as simple as posting them on your website. If you’d prefer, you can also share them upon request. Plus: just like we’ve included sample bylaws in this article for you to read, someday it could help other early nonprofit professionals write their own bylaws! How do I adopt bylaws for my nonprofit? Once your bylaws are drafted, all you have to do is get them approved by the board. Be sure to write down the date on which you want them to become active, and then have them signed and dated. Simple as that, they’ll be officially adopted! Who executes a nonprofit corporation’s bylaws? Once your document is approved for adoption, you might be wondering who should sign the bylaws. Typically, that duty is up to your secretary or assistant secretary. How do I submit bylaws for my nonprofit? Bylaws are submitted to the board of directors to vote on. If you’re submitting a potential amendment, a review will be scheduled for the next board meeting. From there, they will vote to either confirm or reject your proposed amendment. What are the consequences of not following bylaws? The consequences of not following bylaws depend on the severity of the violation. It’s one thing to miss a meeting or two, and another entirely to violate bylaws in a way that has major financial consequences for your organization. Board members can be fined, suspended, or even expelled—in severe cases, bylaw violations can even lead to litigation. If your shareholders are negatively impacted by bylaw violations, they have the right to bring in lawsuits which can lead to criminal prosecution. The key to avoiding this legal trouble is knowing your bylaws front to back! What is the difference between charter and bylaws for nonprofits? Both a charter and bylaws are essential to setting up your nonprofit, but they have different purposes. A charter, also known as your “articles of incorporation,” is akin to your organization’s constitution. It establishes why your nonprofit exists in the first place, and puts core structures into practice. Bylaws are the rules which keep the organization running, and are meant to support the goals of your charter. How often should a nonprofit review its bylaws? A nonprofit should review its bylaws a minimum of every two years. This consistent review will make sure that your bylaws are the most up-to-date reflection of the current needs of your organization. It should be up to your executive director to schedule these review sessions so there isn’t any confusion when officer terms end. What’s the difference between “may” and “shall”? In nonprofit bylaws, language is everything! Here’s an important distinction to know: Shall means your organization has to take an action May means that taking an action is optional as needed Knowing how to use these specific words can save you a world of trouble in the future. You don’t want to have to take unnecessary actions because of a “shall,” or get caught in board conflict because of a “may” disagreement! What else should be included if you’re a 501(3)(c) organization? If you’re a 501(3)(c) organization, there are a few other language choices that should be taken into consideration. One of the most important things to establishing 501(3)(c) status is being clear on your organization’s purpose. Your language must clearly show that your nonprofit does not exist for anything other than its specific mission. Some examples of potential purposes for your nonprofit could be: Charitable Educational Literary Scientific Religious Prevention of cruelty to children or animals Public safety testing Fostering an amateur sports competition It’s also beneficial to include some policies around: Lack of political affiliation Board member compensation (if any) Keeping and destroying records Being thorough with your bylaws can make all the difference in getting 501(3)(c) status! 5 Nonprofit Bylaws Examples If you’re looking to check your bylaws against those of a similar organization, here are bylaws from five different nonprofits: YMCA The YMCA is the leading nonprofit committed to strengthening community by empowering young people, improving the health and well-being of people of all ages and inspiring action in and across communities. Take a look at the bylaws for the YMCA-YWCA of the National Capital Region by clicking here. Habitat for Humanity Habitat for Humanity brings communities together to help working families around the globe build strength, stability and self-reliance through affordable homeownership. Click here to check out the bylaws from the Sunshine Coast chapter. United Way United Way is focused on creating community-based and community-led solutions that strengthen the cornerstones for a good quality of life: education, financial stability and health. Check out United Way’s bylaws by clicking here! Boys and Girls Clubs of America Boys & Girls Clubs of America is a national organization of local chapters which provide voluntary after-school programs for young people. Check out the sample bylaws for the Boys & Girls Club of America (along with a sample constitution!) by clicking here. The Nature Conservancy of Canada The Nature Conservancy of Canada (NCC) is the country’s unifying force for nature, working to deliver large-scale, permanent land conservation. Click here to see what bylaws can look like for an environmentally-driven nonprofit! Using Nonprofit Bylaws to your Advantage Having a watertight set of bylaws when you start your nonprofit sets a strong foundation to grow from. This manual and template can guide you through your growing pains and help you establish legitimacy as an organization! Looking to strengthen the structure of your organization? Wild Apricot can solve all of your membership management needs. Sign up for your 30-Day Free Trial today! Related Organizational Management Articles Organizational Management 🕑 8 Min Read 30 Free Nonprofit Webinars for November 2024 Fundraising 🕑 8 Min Read 501(c)(6) vs 501(c)(3): Simplifying Nonprofit Classifications Membership 🕑 8 Min Read Club Leadership 101: Roles, Responsibilities and Best Practices The Membership Growth Report: Benchmarks & Insights for Growing Revenue and Constituents Get the report now!