What are the Bylaws for an Alabama Nonprofit?

In Alabama, the Bylaws for a nonprofit organization specify in detail how the nonprofit will be managed and operate its affairs. Bylaws are the general rule book for the new nonprofit. The Bylaws are a corporate governance agreement prepared for and by the non-profit’s Board of Directors. The Bylaws identify how the non-profit will be managed, the non-profit’s officers, who will have decision-making rights, and other important considerations.

Bylaws for Huntsville, Alabama Nonprofits: an Overview

Alabama law requires non-profits to have written Bylaws that determine how the non-profit will operate. Unlike in Alabama LLCs, written Bylaws are a legal requirement for Alabama non-profit and for-profit corporations. That said, written agreements are always preferable to prevent potential legal issues or conflicts from arising later.

Organization: 

Bylaws should include information about the charitable nature of the organization, its legal name, its principal place of operation, the date that the non-profit was formed, along with the name and address of the non-profit’s registered agent.

Management:

Alabama non-profits are managed by its Board of Directors, who meet on occasion to deliberate and vote on the direction of the non-profit and its larger goals. Alabama law requires non-profits to have at least three (3) Directors. Directors typically serve terms on the Board before rotating off.

Appointment of Officers:

The Board of Directors appoints the Officers for the non-profit. This is typically first done at the initial meeting of the Board of Directors or through a written consent in lieu of meeting in person.

The Officers usually manage the day-to-day operations of the company, sometimes with the help of an Executive Director on staff. The typical Officer-positions are as follows: the President, Vice-President, Treasurer, and Secretary.

Alabama law states that, while someone can serve as an Officer in more than one position at a time, the President and Secretary cannot be the same person. Officers typically serve in their positions for a term of years that may be renewed by the Board of Directors at their annual meetings.

Dissolution: 

Alabama law requires that the non-profit’s Bylaws detail the process for winding up operations and shutting down the company if the Board of Directors decides to close the non-profit.

Alabama and federal tax law require non-profits seeking Section 501(c)(3) exempt status recognition to include a clause in the Bylaws stating that, if the non-profit dissolves, then any assets of the dissolved entity will be used for the public good.

Specifically, the assets must either go to another § 501(c)(3) non-profit or else be transferred to the government for the public’s benefit. The assets cannot be used for the private benefit of individuals involved in the company.