Vermont Nonprofit Bylaws

Why does a Vermont nonprofit need bylaws?

In Vermont, you don’t have to file your bylaws with the Secretary of State like with your Vermont Nonprofit Articles of Incorporation. However, Vermont does require nonprofits to adopt bylaws. Bylaws aren’t just nice to have, but drafting and adopting bylaws are essential and crucial steps in establishing and maintaining your business. Here are some important factors to remember about Vermont nonprofit bylaws.

1. Nonprofit bylaws are legally required in Vermont.

Let’s take a look at what Vermont statues says about bylaws! VT Code 11B V.S.A. § 2.06 states, “The incorporators or board of directors of a corporation shall adopt bylaws.” Bylaws aren’t a suggestion, but a legal requirement for Vermont nonprofits.

2. Third parties will ask to see your bylaws.

Unlike your Articles of Incorporation, your Vermont nonprofit bylaws aren’t required to be filed with the state. Third parties on the other hand will want to see a copy of your bylaws to either verify your ability to operate on behalf of the nonprofit or to make sure your nonprofit is in good legal standing within Vermont. The IRS will also request a copy of your bylaws if you apply for tax-exempt status under 501(c)(3).

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

Drafting bylaws allows your board of directors the ability to discuss the best ways to run your business. Without bylaws in place to help your board of directors know how to hire, pay, vote, and add directors, your nonprofit will be subject to the default rules of the state—which might not be a good match for your particular organization.

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

What do Vermont Nonprofit Bylaws include?

Vermont statutes state that your bylaws can contain any regulation as long as it doesn’t go against Vermont law or your Articles of Incorporation. But for strong bylaws, your Vermont nonprofit should include guidance for:

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

Your bylaws should also include any basic information about your nonprofit (name, business address, and purpose). You’ll want to make sure your bylaws clearly lay out the ground rules for governing your nonprofit.

Are nonprofit bylaws legally binding?

Yes. Your Vermont nonprofit bylaws are both legally binding and required. Breaking or going against your nonprofit’s bylaws can be met with legal ramifications. Whether or not your bylaws are signed, your board and members are required to abide by the regulations outlined in the nonprofit’s bylaws.

Are nonprofit bylaws public record?

Sometimes. Vermont will not publicly list your nonprofit bylaws or require you to do so. However, when applying for 501(c)(3) tax-exempt status, the IRS will have you file a copy of your bylaws. The IRS then publicly lists your bylaws once they’ve approved your application.