Dissolution of a Nonprofit
A nonprofit that wishes to cease functions is required by law to complete a set of steps. The New York State Attorney General has written guidance to assist a nonprofit organization that is winding up its activities.
The Charities Bureau of the New York State Department of Law has developed procedures to assist nonprofit corporations in fulfilling the requirements for a no asset dissolution pursuant to Article 10 of the Not-for-Profit Corporation Law (N-PCL) efficiently and in the best interests of the corporations and their charitable beneficiaries.
The N-PCL requires that a Verified Petition be submitted to the court even if the dissolving corporation has no assets at the time of dissolution. Legislation has been proposed that would eliminate court involvement in dissolution of not-for-profit corporations that have no assets. Until that proposal is enacted, the Charities Bureau has adopted procedures to simplify the dissolution process.
For instruction on how to dissolve a nonprofit organization that has assets, download the publication Procedures and Forms for a Voluntary Dissolution Pursuant to Article 10 Of the Not-For-Profit Corporation Law of a Not-For-Profit Corporation With Assets at www.charitiesnys.com/pdfs/Asset%20Dissolution%20-%20web%2012-11.pdf.
For guidance on how to dissolve a nonprofit with no assets, download Procedures and Forms for a Simplified Non-Judicial Dissolution Pursuant to Article 10 Of The Not-For-Profit Corporation Law at www.charitiesnys.com/pdfs/SIMPLIFIED%20DISSOLUTION%20Final%2004-06-10.pdf.
Other forms and publications available from the AG's site can be found at www.charitiesnys.com/guides_advice_new.jsp and at www.oag.state.ny.us/bureaus/intergov_affairs/publications.html.
The Charities Bureau is at www.charitiesnys.com.
Copyright 2002 Nonprofit Coordinating Committee of New York, Inc. (NPCC) This article originally appeared in the September 2002 issue of New York Nonprofits, the monthly publication of NPCC. Updated November 2009.