How to start a nonprofit in Arkansas

Short answer: To start a nonprofit in Arkansas, you incorporate by filing Articles of Incorporation — Form NPD-01-501-c-3 with the Arkansas Secretary of State (about $45 online or $50 by mail as of 2026), get a free EIN from the IRS, adopt bylaws, and seat a board of at least three directors. Then comes the part people miss: a nonprofit is not automatically tax-exempt, so you file IRS Form 1023 (or 1023-EZ) to become a 501(c)(3). On the Arkansas side, you register to fundraise with the Secretary of State’s charitable registration (Form CR-01) before you solicit donations, and you file Form AR1023CT to claim state income-tax exemption, because federal recognition does not carry over automatically. And one honest warning most guides bury: Arkansas generally does not exempt nonprofit purchases from sales tax — most nonprofits pay it, with only a narrow new exemption for small qualifying charities.

The federal core — EIN, bylaws, board, and the 501(c)(3) application — is the same in every state. For the full national walkthrough, read how to start a nonprofit; this page focuses on the Arkansas layer stacked on top of it, where the state-specific forms, fees, and agencies actually live.

The formation steps that are the same anywhere

Forming a nonprofit in Arkansas follows the standard checklist, and most of it is federal rather than state-specific:

1. Incorporate as a nonprofit corporation (the Arkansas-specific part — covered in detail below).
2. Get an EIN — a free federal tax ID from the IRS, applied for directly at irs.gov. Never pay a third party for one; the EIN is always free.
3. Adopt bylaws — the organization’s internal rulebook for decisions, leadership, and money. Start from a proven document rather than a blank page; see nonprofit bylaws for what to include.
4. Seat a board of directors who govern the organization, set policy, and hold it accountable.
5. Apply for 501(c)(3) with Form 1023 — this is the step that turns a nonprofit corporation into a tax-exempt charity. Unlike a church, an ordinary nonprofit is not automatically exempt; you must file IRS Form 1023 (or the streamlined Form 1023-EZ if you qualify) and receive a determination letter (IRS, applying for 501(c)(3) status). The full path is in how to start a 501(c)(3).
6. Open a bank account in the nonprofit’s legal name using the EIN and formation documents.
7. Set up the books on fund accounting from day one, before the first grant or donation arrives.

Each of these is walked step by step in the national formation guide linked above. The rest of this page is the Arkansas layer on top.

Incorporating a nonprofit in Arkansas

Arkansas creates the nonprofit as a legal entity when you file Articles of Incorporation — Form NPD-01-501-c-3 with the Arkansas Secretary of State, handled by its Business & Commercial Services (BCS) division. The filing fee is $45 online or $50 by mail as of 2026; confirm the current amount with the Arkansas Secretary of State, since fees change. You can file online through the state portal or mail the form to the BCS office in Little Rock.

Form NPD-01-501-c-3 asks for the nonprofit’s name, its registered agent and office in Arkansas, the incorporators, and a statement of purpose. The Secretary of State’s version of the form is the one already written with 501(c)(3) language built in, and you should keep that language rather than stripping it out:

• A 501(c)(3) purpose clause stating the organization is formed exclusively for charitable, religious, educational, or other exempt purposes.
• A dissolution clause stating that if the nonprofit closes, its assets pass to another 501(c)(3) organization or to government, not to any individual.

Getting that language right at formation saves an amendment later. The full breakdown of what these documents need is in articles of incorporation. On board size, the Arkansas Nonprofit Corporation Act of 1993 sets the floor at three directors under Ark. Code Ann. § 4-33-803, and three unrelated directors is also the practical standard the IRS looks for, since a one-person board reads as a red flag on the Form 1023.

Registering to fundraise in Arkansas

Here is the step that trips up nonprofits coming from a church background, where it usually does not apply: Arkansas requires most charities to register before they solicit contributions from the public. A church taking offerings can often skip this; a general nonprofit asking the public for money cannot.

That registration goes to the Arkansas Secretary of State, not the Attorney General — a point worth flagging, because many state guides and out-of-state filing services assume the Attorney General. In Arkansas, the Secretary of State’s BCS division runs charitable registration through Form CR-01, the Charitable Organization Registration Form, and there is no filing fee as of 2026; you must register before soliciting contributions, using fund-raising counsel, or running a sales promotion (Arkansas Secretary of State, charitable entities). The Attorney General’s Consumer Protection Division handles complaints and enforcement about charitable solicitation, but the registration itself is filed with the Secretary of State. You submit Form CR-01 with your IRS determination letter and Articles of Incorporation.

Registration is not one-and-done. Charities that stay registered file an annual financial report on Form CR-03. Smaller organizations may not have to register fully — those receiving under a set contributions threshold (commonly cited as $25,000 per year), along with certain religious, educational, and governmental organizations, can instead claim exempt status by filing Form EX-01, the Exempt Organization Verification, with their IRS letter and Articles. Confirm both the current threshold and the renewal deadline with the Secretary of State before you rely on either, since the rules have been revised (Act 137 of 2019 moved the annual report deadline to within 180 days after each organization’s fiscal year-end).

Arkansas sales tax and your nonprofit

Now the honest answer most state guides skip: Arkansas generally does not give nonprofits a blanket sales tax exemption. Federal income-tax exemption does not make a nonprofit exempt from Arkansas sales and use tax, and for years the default was that a charity paid sales tax on the equipment, supplies, and goods it bought, the same as any business.

That changed only at the margins. Act 1007 of 2025, effective June 1, 2025, created a narrow sales tax exemption for purchases by qualifying 501(c)(3) organizations — but only those with an annual operating budget of $200,000 or less that perform charitable community-based services in Arkansas for residents in need. Even then, the organization has to apply to the Arkansas Department of Finance and Administration (DFA) through the Arkansas Taxpayer Access Point (ATAP), receive an exemption certificate, and recertify every three years, and several categories of purchases stay taxable. So unless your nonprofit is small enough and service-oriented enough to fit Act 1007 and you have actually obtained the certificate, budget as if your purchases are taxable, and confirm your situation with the Arkansas Department of Finance and Administration before assuming an exemption applies.

State income tax is a separate filing of its own. Arkansas does not automatically recognize a federal 501(c)(3) for income-tax purposes, so a nonprofit files Form AR1023CT, Application for Income Tax Exempt Status, with the Department of Finance and Administration to be exempt from Arkansas income tax. There is no fee for that application, but skipping it leaves the corporation on the state’s income-tax rolls despite its federal status.

Arkansas filing at a glance

The table below maps each step to its agency, form, and cost. Treat the fees as accurate as of 2026 and confirm with the listed agency, since Arkansas fees and forms change.

What you’re doing	Agency	Form	Fee (as of 2026)
Incorporate the nonprofit	Arkansas Secretary of State	Articles — Form NPD-01-501-c-3	$45 online / $50 mail (confirm)
Get a federal tax ID	IRS	EIN application (online)	Free
Apply for 501(c)(3) status	IRS	Form 1023 or 1023-EZ	$600 / $275 user fee
Register to fundraise	Arkansas Secretary of State	Form CR-01 (CR-03 annual)	No fee (confirm)
Claim state income-tax exemption	Dept. of Finance and Administration	Form AR1023CT	No fee
Sales tax on purchases	Dept. of Finance and Administration	Act 1007 certificate (if eligible)	Generally taxable (narrow exemption)

Setting up the books once the nonprofit exists in Arkansas

Once the entity is formed and the exemptions are filed, the work shifts from one-time paperwork to the monthly routine — and that routine is where nonprofits either hold together or quietly fall apart. A nonprofit holds money in trust for the people and purposes it serves, much of it restricted by donors or grant terms, so it tracks money by fund rather than as a single bottom line. Set the books on fund accounting before the first grant lands, keep the giving records donors need, and document that the board reviews the finances; the discipline is covered in nonprofit accounting. The Arkansas angle to keep on your calendar is the CR-03 annual financial report — that renewal to the Secretary of State is what keeps your charitable registration current, and letting it lapse can put the registration into delinquent status.

FAQ

How much does it cost to start a nonprofit in Arkansas? The required state cost is modest. Filing Articles of Incorporation (Form NPD-01-501-c-3) runs about $45 online or $50 by mail as of 2026, and the Secretary of State’s charitable registration (Form CR-01) has no fee — so the Arkansas paperwork is roughly $45 to $50 plus your time. The state income-tax exemption form (AR1023CT) also has no fee. The bigger line item is federal: the IRS charges a $275 user fee for Form 1023-EZ or $600 for the full Form 1023, which is what actually makes you a 501(c)(3). Realistically, a small Arkansas nonprofit can be stood up properly for a few hundred dollars once you include the federal exemption application.

Do you register an Arkansas nonprofit with the Attorney General or the Secretary of State? The Secretary of State, in both cases. Arkansas charities register to fundraise with the Secretary of State’s Business & Commercial Services division using Form CR-01, not the Attorney General (Arkansas Secretary of State, charitable entities). The Attorney General’s office handles consumer-protection complaints about charitable solicitation, so it does have a role, but the registration paperwork and the annual CR-03 report go to the Secretary of State.

Is my Arkansas nonprofit exempt from sales tax? Usually not. Arkansas does not give nonprofits a blanket sales tax exemption, so most pay sales tax on what they buy. A narrow exemption arrived with Act 1007 of 2025 for qualifying 501(c)(3) organizations with an annual operating budget of $200,000 or less that serve Arkansas residents in need — but it requires applying to the Department of Finance and Administration for a certificate and recertifying every three years. Confirm your eligibility with the DFA before assuming the exemption fits, and budget for sales tax otherwise.

How long does it take to start a nonprofit in Arkansas? The Arkansas incorporation itself is relatively quick — online filing of the Articles is often processed within a few business days, with mailed filings taking longer. The slow part is federal: the IRS can take anywhere from about a month (Form 1023-EZ) to many months (full Form 1023) to issue the 501(c)(3) determination letter, and you generally want that letter before filing the state’s AR1023CT income-tax exemption. Plan for the state entity to exist within days but the full tax-exempt status to take several months end to end.

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Vestrybooks sets up a new Arkansas nonprofit’s books on fund accounting from day one — funds, reconciliation, and the board reports — so the financial side is right before the first grant arrives. See how it works.

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