Foreign Nonprofit Corporations in North Carolina

North Carolina's nonprofit statute, G.S. 55A-15-01, provides that a foreign nonprofit corporation shall not conduct affairs in the state without first obtaining the certificate of authority. "Foreign" only means that another jurisdiction's law created the corporation. The Business Registration Division handles the application and issues the certificate with a copy of the filed application attached.

Where a business corporation "transacts business", a nonprofit "conducts affairs". The certificate does not recognize tax-exempt status, and it does not license fundraising. Those are separate matters, covered at the end of this page.

As with other entities, the statute gives no definition. G.S. 55A-15-01(b) names activities that are insufficient by themselves, and the list is open-ended. A foreign nonprofit is not conducting affairs in North Carolina solely because it:

• Litigates, defends, or settles disputes, including administrative and arbitration proceedings
• Holds directors' or members' meetings, or handles internal governance
• Maintains bank accounts or borrows money, secured or unsecured, even on a continuing basis
• Keeps an office to transfer or register memberships or securities, or appoints trustees or depositories for those securities
• Seeks purchase commitments that are only binding when accepted beyond North Carolina
• Lends or buys loans, hires outside servicers for mortgages, forecloses, then manages or rents the foreclosed property briefly while liquidating the investment, as long as no North Carolina office or agency exists for that activity
• Takes security for debts it is owed, collects them, or enforces its rights in the collateral
• Conducts affairs in interstate commerce
• Completes a single transaction within six months, outside any repeating pattern
• Sells through independent contractors
• Owns real or personal property, "without more"

For many out-of-state charities the property item matters most. A nonprofit that owns a building, a camp or land in North Carolina but runs nothing there stays on the safe side. Opening a program office, employing staff, or running regular events and services in the state looks different, and that is a good moment to consult an attorney.

Form N-09, which the Secretary of State lists as the nonprofit certificate-of-authority application, costs $125 to file. The office's forms list connects it to the online business creation filing, where a completed PDF can be submitted. Mailing it to P.O. Box 29622 in Raleigh, or using courier or in-person delivery, also works. Paying online costs $3 extra by card, or $2 extra by ACH. A 24-hour review is available for $100 extra and a same-day review for $200 extra when requested with the submission.

Questions on the form

• The corporation's name, and a different name for North Carolina if the original is unavailable
• Its home state or country, incorporation date and duration
• The principal office, by street address, with any separate mailing address
• The registered office's street address and county, a separate mailing address if there is one, and the name of the registered agent
• Names, titles and business addresses of the current officers
• Whether the corporation has members, as a box to check
• The attached certificate of existence
• A board resolution for a fictitious name, if needed
• An effective date, delayed by no more than 90 days

An officer signs. There is no notary block. Once the Secretary of State finds the application in order, the filing is accepted and the certificate of authority follows.

A foreign nonprofit must attach proof of existence from where it was formed: a certificate of existence (a similar record also counts), signed by the official responsible for corporate records there. That comes from G.S. 55A-15-03(b), and item 11 of Form N-09 repeats it.

The form itself does not state an age limit. The office's Register a Foreign Business manual does: any foreign entity's certificate must be an original and no older than six months. The manual also says electronic certificates are fine when your home state offers them, and that two states provide none at all, in which case the paper original must be mailed. Order the certificate before you prepare the rest of the package so that it is fresh when you file. The home state's fee for the certificate is separate from the North Carolina fee.

Names are governed by G.S. 55D-22, which lets a foreign nonprofit whose name does not qualify add an ending such as incorporated, corporation, company or limited (or the usual abbreviation) for use in North Carolina. If the real name is unavailable, the nonprofit can instead adopt a fictitious name and file the board resolution that approves it. The name must also be distinguishable from entities already on the Secretary of State's records.

Agent and office

G.S. 55A-15-07 and 55D-30 require an authorized foreign nonprofit to maintain a registered office and registered agent in North Carolina continuously. The agent may be:

• An individual who lives in North Carolina and has the registered office as a business office
• A domestic corporation, nonprofit corporation or LLC with its business office there
• A corporation, nonprofit or LLC formed outside the state but authorized to operate in it, with its business office there

The Secretary of State's manual says a business agent must be active on the state's registry. The agent has one statutory job, which is forwarding anything served on it. No business hours are prescribed. Changing the agent or office requires a statement of change at $5. If no agent is in place, or one cannot be found despite diligent effort, the Secretary of State becomes the contact for lawsuits.

According to the Secretary of State's FAQ, nonprofits do not have to file annual reports with that office. Revocation is still possible. Under G.S. 55A-15-30 the Secretary of State may begin it if fees or penalties go unpaid for 60 days, if the corporation is without an agent or registered office for 60 days, if an agent change is not reported within 60 days, if a signer knowingly files a false document, or if the home state certifies that the corporation has dissolved. A written notice precedes any revocation, giving the nonprofit 60 days to resolve the problem.

A change to the corporation's name, duration or home state is filed on Form N-10 for an amended certificate, at $25. Leaving the state requires a certificate of withdrawal, which G.S. 55A-15-20 describes. The Secretary of State's own materials show two different fees for that filing, so confirm the amount with the office before you send a check.

Related registrations

Licenses to ask for donations come from another unit within the same office, and the FAQ tells nonprofits to check with it. Tax-exempt status is a further, separate matter, and the FAQ refers owners to the IRS and the NC Department of Revenue. This page does not cover either.

G.S. 55A-15-02 attaches these consequences to a foreign nonprofit that conducts affairs without a certificate:

• It cannot maintain a legal action in a North Carolina court unless it obtained the certificate before trial
• Back fees and taxes become collectible, along with interest and penalties, for the period of unauthorized activity
• A civil penalty of $10 runs for each day, to a maximum of $1,000 for any year or part of one
• The Attorney General may bring suit to collect

Validity of the nonprofit's acts is not affected. Its agreements stand, and it may defend itself in court. Because the daily penalty and the lawsuit bar start when the nonprofit begins conducting affairs without authority, registering before a program launches avoids both.

Mainstay's qualification checkout has no nonprofit option, because it only serves LLCs and for-profit corporations. Form N-09 is the nonprofit's own filing, or its lawyer's. What Mainstay sells is the registered agent: $149 each year, and that figure stays put at renewal.

The North Carolina address that Mainstay provides goes on the application as the registered office and becomes public. A summons or other court paper that arrives for the agent is scanned and made available in your account that same business day, at no cost. Government mail receives the same courtesy for its first three items each year. If the nonprofit already lists a different agent, Mainstay can submit the change and bills the state's $5 charge at cost. See the North Carolina registered agent page for specifics. Mainstay is not a law firm.