Articles of incorporation vs bylaws: What’s the difference?

When a board member wants to know how many board members are needed for a quorum, do you direct that board member to your nonprofit’s articles of incorporation or the bylaws? Which compliance document has the answer?

Many nonprofit leaders are confused when it comes to distinguishing between these essential legal documents. If you’re struggling to understand the distinction between articles of incorporation and bylaws, our guide will clear up any confusion with a closer look at the key differences.

What are articles of incorporation?

Articles of incorporation pertain to corporations, limited liability companies and nonprofit organizations. They are especially vital to effective nonprofit governance and compliance. The articles combine to form one of the necessary documents to establish a nonprofit and get it up and running. Depending on the state where your nonprofit was established, this document is sometimes called the articles of organization, articles of formation or certificate of formation.

State governments regulate nonprofits in their states, and all nonprofits must file formal documents with the proper state authority to form a tax-exempt organization. In most states, the proper authority is the Secretary of State or a similar agency. Once the state authority receives your documents, the documents become available for public viewing.

The articles of incorporation tell your state what your nonprofit intends to do according to its mission. The articles of incorporation also outline who is responsible for managing the nonprofit. Certain states may require additional provisions depending on their state mandates. States typically provide a standard form to make sure your articles meet the legal requirements.

Plan to gather the following information before filing your articles of incorporation:

• Name of the founder or founders
• Name of your nonprofit
• Names of your nonprofit’s initial board of directors
• Addresses for each of the board member’s initial directors
• Nonprofit’s mission statement
• Location of the primary office and mailing address
• Name of the registered agent

After the board drafts a final articles of incorporation, it is time to approve them and file the form with the proper state and federal authorities.

Good governance means having solid processes in place — rules that build a foundation, policies that guide your next steps, and coordinated activities that ensure informed oversight. Our guide simplifies your governance with actionable insights and empowers your board with tools for secure communication and effective decision-making. Download the guide today to transform data into strategic success and drive exceptional performance.

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What are bylaws?

By contrast, bylaws are internal documents that describe how you will run your nonprofit — in other words, an operating manual. Bylaws are the rules that govern how the board will function:

• How often it will convene
• Quorum requirements
• Election protocols
• Meeting organization and follow-up

As Expertnonprofits.com says, “Bylaws are like your nonprofit’s operating manual. They outline the rules for governance, decision-making, and daily operations. Think of them as the playbook that helps everyone from the board of directors to management teams play their part effectively.”

“Bylaws are like your nonprofit’s operating manual. They outline the rules for governance, decision-making, and daily operations. Think of them as the playbook that helps everyone from the board of directors to management teams play their part effectively.” – Expertnonprofits.com

Establishing bylaws is a necessary part of obtaining tax-exempt status as a nonprofit organization from the federal government. During the 501(c)(3) application process, the IRS will ask for a copy of your bylaws and file them along with your application and articles of incorporation.

Nonprofits do not need to submit a copy of their bylaws to the IRS every year. However, you are required to provide summaries of significant changes to bylaws (and articles of incorporation) using Schedule O of Form 990.

While nonprofit founders and board of directors may have a preference about filing bylaws before, after or at the same time as they file the articles of incorporation, the timing of filing bylaws depends on the laws in your state of incorporation. However, some states do not require that nonprofits file bylaws.

Often, nonprofit leaders establish a board of directors before they write the bylaws. This helps to bring multiple perspectives into the organization from the start.

As you create your nonprofit’s bylaws, be prepared to include:

• Official name and location
• Mission or statement of purpose
• Comprehensive policies and procedures
• Operating standards
• Number of officers and directors
• Term lengths for officers and directors
• Processes for holding board meetings
• Record-keeping procedures
• Requirements for making amendments to the bylaws
• Requirements for amending the articles of incorporation

What are the key differences between articles of incorporation and the bylaws?

For a better understanding of a nonprofit’s legal documents, the following are key distinctions between articles of incorporation and bylaws.

Secure, confidential access to legal documents

An essential responsibility of every new nonprofit board member is to read and understand the articles of incorporation and bylaws. Directors can find answers to questions about operating procedures, tax-exempt status, board meeting schedules and many other topics in these documents.

BoardEffect, a secure, confidential board management solution, provides a secure central location where directors can access these legal documents with ease, from any mobile device. They can also retrieve board agendas, meeting minutes, committee reports and other information vital to their work as directors.

Find out how BoardEffect can support your nonprofit board. Request a demo today.