Kentucky Nonprofit Bylaws

Why does a Kentucky nonprofit need bylaws?

You won’t need to submit your nonprofit bylaws to the Secretary of State like your Kentucky Nonprofit Articles of Incorporation. However, your bylaws will likely become public record, mainly if you apply for non-exempt status. Let’s go over the main reasons your nonprofit needs comprehensive bylaws.

1. Nonprofit bylaws are legally required in Kentucky.

Enacting bylaws is legally required in Kentucky. Kentucky Revised Statutes § 273.191 states that all domestic nonprofit corporations “shall” adopt bylaws, and in legal terms, “shall” is the equivalent of “must.”

2. Third parties will ask to see your bylaws.

You can expect numerous third parties to ask to see your bylaws for financial and business purposes. For example, banks, investors, and partnering organizations may want to review your bylaws before deciding to do business with your nonprofit. The IRS will also inspect your bylaws before granting your nonprofit tax-exempt status.

3. Nonprofit bylaws allow you more control over your nonprofit.

Your nonprofit bylaws help prevent and resolve internal disagreements by laying out the rules for running your organization along with your members’ roles and authority levels. These regulations are critical in potentially charged situations where members could disagree, such as dealing with a conflict of interest or ousting a board member. Without firm guidelines, your nonprofit is more likely to experience disputes between members. Disputes can lead to state investigations or lawsuits that drain your nonprofit’s resources and damage its reputation. Keep your bases covered with robust nonprofit bylaws.

Want to learn more? Check out our Guide to Nonprofits.

What do Kentucky Nonprofit Bylaws include?

Your Kentucky nonprofit bylaws should include basic information about your nonprofit, including its name, address, and purpose. Your bylaws should also contain the rules and regulations for governing your nonprofit. These rules should cover:

• adding or removing board members
• giving notice and holding board meetings
• taking a vote and meeting quorum requirements
• handling conflicts of interest
• compensating directors
• keeping records
• amending the bylaws
• operating during emergencies
• dissolving the nonprofit

You can also add provisions specific to your organization as long as those provisions don’t defy the law or your articles of incorporation.

Are nonprofit bylaws legally binding?

Yes, your nonprofit bylaws are a legally binding contract that your members must uphold. If any member of your organization breaches this contact, your nonprofit and the violating member could face severe legal consequences.

Are nonprofit bylaws public record?

Whether or not your bylaws become public record depends on your nonprofit. Your bylaws will become public if you seek 501(c)(3) tax-exempt status with the IRS because you must attach a copy of your bylaws to your application, and the IRS makes all applications public. You may also decide to publish your bylaws to increase transparency with your donors, beneficiaries, and supporters.