How to Keep Your Nonprofit in Good Standing Year-Round

Introduction

Good standing means your nonprofit is meeting its required obligations with the IRS and the state where it operates. When an organization remains in good standing, it can operate legally, fundraise without interruption, and maintain its 501(c)(3) tax-exempt status.

Compliance is not something nonprofits handle once and move on from. It is an ongoing responsibility that continues year after year. This guide explains what good standing really means, which filings are required, and how nonprofit leaders can stay organized and compliant throughout the year.

If you are still in the early stages, start with our Nonprofit Compliance Checklist: What Every Founder Needs to Know. Then use this guide to maintain compliance as your organization grows.

What "Good Standing" Means for a Nonprofit Organization

A nonprofit in good standing has completed all required filings and kept its organizational information current. In practical terms, good standing is what allows your organization to operate without interruption, fundraise legally, and maintain credibility with donors and grantmakers.

For most nonprofits, staying in good standing typically means:

• Filing required state reports on time
• Submitting IRS Form 990 annually
• Maintaining active charitable registration when fundraising
• Keeping accurate governance and financial records

When these requirements are met, a nonprofit remains eligible to operate, fundraise, apply for grants, and enter partnerships.

The IRS outlines ongoing federal requirements for nonprofits on its Charities and Nonprofits page.

Annual State Filings: A Core Compliance Requirement

Most states require nonprofits to file an annual or biennial report. This filing confirms that your organization’s public records are accurate and up to date.

State reports typically verify details such as your nonprofit’s legal name, address, registered agent, and current officers or directors. Missing a required filing can lead to late fees, loss of good standing, or administrative dissolution.

Because requirements vary by state, it is important to check your Secretary of State’s website for deadlines and filing rules. Many states publish nonprofit-specific guidance directly on their official sites.

IRS Form 990: Required Every Year

Every tax-exempt nonprofit must file an annual return with the IRS, even if the organization had little or no financial activity during the year.

The IRS uses three primary versions of Form 990:

• Form 990-N (e-Postcard) for organizations with gross receipts under $50,000
• Form 990-EZ for nonprofits with gross receipts under $200,000 and total assets under $500,000
• Form 990 for organizations exceeding those thresholds

Failing to file for three consecutive years results in automatic revocation of tax-exempt status.

The IRS provides official filing guidance and current thresholds on its Annual Filings and Forms page.

Charitable Registration and Renewals

If your nonprofit solicits donations, many states require charitable registration before fundraising begins. These registrations often must be renewed annually to remain active.

Renewal requirements vary by state but commonly include updated financial information, current leadership details, and copies of your most recent IRS Form 990. Nonprofits that fundraise online or across state lines may need to manage multiple registrations.

State-by-state charitable solicitation resources are available through the National Association of State Charity Officials (NASCO).

Governance Practices that Support Good Standing

Compliance extends beyond filings. Strong governance practices help demonstrate accountability and transparency, which are essential for maintaining trust with donors, grantmakers, and regulators.

Most nonprofits should hold board meetings at least once per year, though quarterly meetings are considered best practice. Decisions made by the board should be documented clearly in meeting minutes. Bylaws should also be reviewed periodically to ensure they reflect how the organization actually operates.

Good governance records help support compliance reviews, audits, and leadership transitions.

Keeping Records Organized

Well-organized records make compliance easier and reduce stress during filing season. They also support transparency, leadership transitions, and funding applications. When documents are easy to access, nonprofits can respond more confidently to state agencies, the IRS, and potential grantmakers.

At a minimum, nonprofits should maintain access to:

• Formation documents
• Bylaws and amendments
• Board meeting minutes
• Financial statements
• IRS and state correspondence

Keeping documents organized also helps with grant applications, audits, and institutional knowledge as leadership changes over time.

Filing Amendments When Changes Occur

When a nonprofit experiences changes, state records often need to be updated. Common updates include changes to officers or directors, address changes, registered agent updates, or revisions to the organization’s purpose.

Filing amendments promptly helps keep public records accurate and prevents compliance issues later.

When Staying in Good Standing Matters

Maintaining good standing is about more than avoiding penalties. Staying current with compliance requirements helps nonprofits:

• Protect their 501(c)(3) tax-exempt status
• Build trust with donors and grantmakers
• Remain eligible for funding and partnerships
• Avoid operational interruptions

Consistent compliance supports both your mission and your organization’s long-term stability.