What You’ll Learn
If you’re a nonprofit in Alaska, or you’re a nonprofit considering fundraising or other activities in Alaska, you must understand the requirements that Alaska has established for nonprofits operating in the state.
How can you become familiar with these laws? Where should you start?
Start here. This state profile includes the basic requirements nonprofits must consider. Reading the profile and implementing appropriate compliance measures will help you prepare your organization for success in Alaska.
Getting to Know the State Nonprofit Corporation Law
*Important primarily for nonprofits incorporated in Alaska
Nikita was a peasant of about fifty from a neighboring village, ‘not a manager’ as the peasants said of him, meaning that he was not the thrifty head of a household but lived most of his time away from home as a laborer. He was valued everywhere for his industry, dexterity, and strength at work, and still more for his kindly and pleasant temper. But he never settled down anywhere for long because about twice a year, or even oftener, he had a drinking bout, and then besides spending all his clothes on drink he became turbulent and quarrelsome.
- Master and Man, Leo Tolstoy
When reading a novel, we get to know a fictional character by the author’s description of him or her. The author tells us what the character will look like, what his or her purpose will be, how he or she will act, and how he or she will make decisions.
Nonprofit corporations are something like fictional characters.
We learn how a nonprofit will look and act and make decisions not by reading a novel, but by reading the state law (called the nonprofit corporation act) and the rules the nonprofit makes for itself (called the bylaws and articles of incorporation). The law and the organization’s own rules tell us what the organization will be called, what its purpose will be, how the nonprofit will act, and how it will make decisions.
To get to know your own nonprofit, you must be familiar with the sections below.
State Nonprofit Corporation Law
Conflict Transactions: See Alaska Stat. § 10.20.141; see also for-profit Corporation Act, Alaska Stat. § 10.06.478; Need to review the basic best practices for conflicted transactions? See Bylaws Module 14: Conflicts of Interest.
For Religious Nonprofits
Nonprofit Religious Corporation Act: Alaska’s nonprofit corporation law mentions the option for nonprofit corporations to incorporate for religious purposes. However, the law lacks both: (a) specific provisions to protect the right of nonprofits incorporated for religious purposes to self-government in internal affairs and (b) an option to incorporate expressly as a nonprofit religious corporation. Alaska Stat. § 10.20.005 and Alaska Stat. § 10.40.010; Confused about what it means to be a religious nonprofit corporation? See our whitepaper “Why a Religious Corporation?”
Reliance on Religious Guidance in Governance: Alaska law permits a director, in the fulfillment of the director’s fiduciary duties, to rely on the opinion of individuals who can reasonably be assumed to have expertise on a certain matter, but does not expressly allow a director to rely on guidance from religious figures within his or her faith tradition. See Alaska Stat. § 10.06.450
Understanding Religious Liberty in this State
*Important for all nonprofits doing business in Alaska, whether incorporated in Alaska or elsewhere
The religious education and formation of students is the very reason for the existence of most private religious schools, and therefore the selection and supervision of the teachers upon whom the schools rely to do this work lie at the core of their mission. Judicial review of the way in which religious schools discharge those responsibilities would undermine the independence of religious institutions in a way that the First Amendment does not tolerate.
- Our Lady of Guadalupe School v. Morrisey-Berru, 140 S. Ct. 2049 (2020).
Sometimes, the state or local government (like the city or county) make laws that could conflict with your organization’s free exercise of religion or its sincerely-held religious beliefs.
For example, a law might require employers not to make faith-based distinctions between job candidates. If your organization’s mission is to pass on the teachings of your faith, you will need to make faith-based distinctions in evaluating candidates because their faith commitments will impact their abilities to partner in your mission and witness the faith to your program participants.
So what do you need to do? Be aware of the laws listed below. If any of them impact your organization—for example, if you are an employer or a facility open to the public—learn more about how you can protect yourself by reviewing Napa Legal’s religious liberty resources. Talk to an attorney if you have specific concerns.
Religious Liberty Protections
State Religious Freedom Restoration Act: Alaska has not enacted a RFRA and has enacted nondiscrimination laws that conflict with the beliefs of many religious organizations (but see Alaska Const. Art. I, § 4); Not sure what a “religious freedom restoration act” is? Click here to learn the fundamentals.
Constitutional Protections for Free Exercise: The Alaska Constitution has been interpreted by the Alaska Supreme Court to provide stronger protections for religious free exercise or worship than the federal First Amendment. Alaska Constitution, Art. I, § 4: No law shall be made respecting an establishment of religion, or prohibiting the free exercise thereof. See also: Alaska’s Constitution: A Citizen’s Guide.
State Blaine Amendment: The Alaska Constitution contains a Blaine Amendment that could prevent the participation of faith-based schools in generally available public benefit programs on the same terms as similarly situated secular schools. This is not as broad as a general Blaine Amendment, which prohibits all aid to faith-based institutions, but is still detrimental to the work of faith-based institutions. Current U.S. Supreme Court precedent has rendered this language ineffective, but it could become effective in the future if Court precedent changes. Alaska Constitution, Art. VII, § 1; Not sure what a Blaine Amendment is? Review the basics here.
Other Relevant State Laws and Regulations
Religious Freedom and Public Accommodation Laws: Alaska’s nondiscrimination laws generally restrict religious freedom for religious organizations that offer public programming and facilities and provide no meaningful religious accommodations or exemptions. See Alaska Stat. § 18.80.230 Public Accommodation, and local regulations and ordinances, such as Anchorage Municipal Code § 5.20.050. Not sure what a public accommodation law is or what it means for your organization’s religious liberty? Learn the basics in this article which discusses the issue in the context of the case Fulton v. City of Philadelphia.
Protections for Religious Exercise in State of Emergency: Alaska law has no explicit constitutional or statutory protections for religious exercise during a time of emergency.
Conducting Activities or Programs in this State
Understanding the Business Registration Requirement
*Important primarily for nonprofits doing business in Alaska but incorporated elsewhere
Depending on the type and volume of activities an organization has in this state, an organization may also need to register as an out-of-state business (sometimes called a “foreign business”) with the secretary of state or another state agency.
These foreign business registration requirements are separate from the charitable registration. An attorney can assist the organization in determining whether its connections with this state are significant enough to trigger the foreign business registration requirement. Examples of activities which might trigger this requirement include having employees physically located in the state, conducting programs in the state, and having an office in the state. When in doubt, organizations are encouraged to register, particularly if they receive any revenue from Alaska.
Business Registration Statute
Fundraising and Charitable Registration in This State
How to Know (And What to D0) If You're Fundraising In This State
*Important for both Alaska and Foreign Nonprofits
Not sure what “charitable registration” is? Need to review the basics? Read this article for a refresher.
Under Alaska law, most organizations must register before soliciting in Alaska. How do you know if your organization is soliciting in Alaska? Under Alaska law, your organization is soliciting any time you make a request to an Alaska resident for a donation, even if the request is made through the internet.
These requirements apply not only to secular organizations, but also to most faith-based nonprofits.
However, if your faith-based nonprofit is an organization such as a church that is exempt from filing the IRS Form 990, you might be eligible for an exemption from the charitable registration requirement. You receive this exemption by applying through the Alaska Department of Law’s Consumer Protection division.
Your organization might also be exempt from the charitable registration requirement if the organization is volunteer-run and either: (1) receives less than $5,000 annually, or (2) receives donations from fewer than ten people. (Unfortunately, the statute does not specify whether the $5,000 contribution maximum is for contributions within Alaska or total contributions.)
If You're Fundraising In Multiple States, Make Sure You Understand the URS
Your organization can complete the Alaska charitable registration requirement by the Unified Registration Statement, which is a standardized charitable registration accepted in many states.
You should consider the following pros and cons when deciding whether to use the URS. If you use the URS, you must complete the form and attachments manually and mail the completed form and related checks to Alaska. If you make any mistakes in the form or in the payment, you may end up delaying the process and having to engage in additional communication with the Department to complete the registration.
Alaska also allows charities to file online, both for the initial registration and subsequent renewals. You face a lower risk of omitting information or making mistakes in the payment if you use the online method because the system will not allow submission if all information and payment are not complete. Additionally, if you use the online option for the initial registration, the system will save the submission and that can streamline the renewal process in the future.
Evaluate Whether You'll Need a Registered Agent
Some states require organizations to appoint a “registered agent” in the state as part of the organization’s charitable registration. This state currently has this requirement. See Alaska Stat. § 10.20.026
Follow the Rules About Communicating with the Public
This state does not require organizations to post specific language when conducting charitable solicitations unless the organization is working with a professional fundraiser.
Charitable Registration Statute
Charitable Registration Exemption Statute
Annual Report Requirement
Get Acquainted with State and Local Taxes and Exemptions
State and Local Taxes
*Important for all nonprofits doing business in Alaska, whether incorporated in Alaska or elsewhere
In this state, organizations which have received federal income tax exemption under IRC Sec. 501(c)(3) are automatically exempt from state income tax. Some organizations may choose to send a copy of their IRS determination letter to the state department of revenue to indicate the organization’s position that it qualifies for the exemption.
Corporate Income Tax Statute
Corporate Franchise Tax Statute
What You Need to Know About Sales Tax
State-Specific Special Requirements
A volunteer attorney in Alaska.
This resource contains general educational information related to legal concepts, but this information does not constitute legal advice. Anyone seeking legal advice is strongly encouraged to consult with a licensed attorney regarding any of the matters discussed herein. Although licensed attorneys work with Napa Legal, Napa Legal is not a law firm and does not undertake legal representation on behalf of any clients. Further, no licensed attorney working with or on behalf of Napa Legal agrees to undertake legal representation on behalf of any client unless the terms of such representation are set forth in a separate, written representation agreement.
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**Please note that the following state profiles are forthcoming and will be published soon:Hawaii and Washington