How to Start a Nonprofit in Minnesota: Filings, 501(c)(3), and Registration

To start a nonprofit in Minnesota, you file articles of incorporation with the Secretary of State, get an Employer Identification Number from the IRS, adopt bylaws, apply for federal 501(c)(3) tax-exempt status, apply separately for Minnesota tax exemptions, and register with the Minnesota Attorney General before soliciting any donations. Expect to pay $70 to incorporate with the state and either $275 or $600 for the federal exemption application, depending on which form you qualify to file.1Office of the Minnesota Secretary of State. Business Filing and Certification Fee Schedule2Internal Revenue Service. Form 1023 and 1023-EZ: Amount of User Fee The steps build on each other, so order matters.

Pick a Name and a Registered Office

Your nonprofit’s name must be distinguishable from every other business entity already on file with the Minnesota Secretary of State, including for-profit corporations, LLCs, and limited partnerships. Search the Secretary of State’s online database before you commit. Minnesota does not require the name to include “corporation” or “incorporated,” though many organizations add one for clarity.3Minnesota Office of the Revisor of Statutes. Minnesota Statutes 317A.115 – Corporate Name

Every Minnesota nonprofit must also maintain a registered office within the state where it can receive legal documents and government correspondence. You can designate a registered agent to accept service of process at that address, but the statute does not strictly require one.4Minnesota Office of the Revisor of Statutes. Minnesota Statutes 317A.121 – Registered Office; Registered Agent Commercial agent services generally run $49 to $300 a year if you’d rather not list a board member or officer.

Draft Your Articles of Incorporation

The articles of incorporation are the founding legal document of your nonprofit. Minnesota provides a standardized form through the Secretary of State’s website, but you need to tailor the content to your mission and to the requirements the IRS will later check when you apply for tax exemption.5Office of the Minnesota Secretary of State. Minnesota Non-Profit Corporation Forms The articles need to include:

  • A purpose statement. If you plan to seek 501(c)(3) status, the purpose must be limited to charitable, educational, religious, scientific, or other exempt purposes recognized by the IRS. Write it broadly enough to cover your planned activities, but narrowly enough that it clearly fits an exempt category.
  • A dissolution clause stating that any assets remaining when the organization winds down will go to another 501(c)(3), a government entity, or another exempt purpose. The IRS requires this language in your organizing document before it will grant exempt status.6Internal Revenue Service. Dissolution Provision Required Under Section 501(c)(3)
  • The registered office address.
  • The name and address of at least one incorporator, who signs the document.
  • The duration of the corporation (usually perpetual).

Your board must have at least three directors under Minnesota law. Directors must be natural persons, and a majority must be adults. The articles or bylaws can add qualifications such as residency or professional background, but the statute does not require any.7Minnesota Office of the Revisor of Statutes. Minnesota Code 317A – Section 317A.203 – Number

File With the Secretary of State

You can submit the articles online, by mail, or in person by appointment at the St. Paul office. The fee depends on the method:1Office of the Minnesota Secretary of State. Business Filing and Certification Fee Schedule

  • By mail: $70
  • Online: $90
  • In person (appointment required): $90

Online and in-person filings are typically processed within one to two business days. Mail takes two to three weeks. When the filing is accepted, the Secretary of State issues a certificate of incorporation. With that certificate in hand, the organization can open bank accounts, sign contracts, and operate under its corporate name.

Get an Employer Identification Number

Before you can apply for tax-exempt status, you need an EIN from the IRS. This nine-digit number identifies the organization on every federal tax filing and is required on the 501(c)(3) application. Applying online through the IRS website is fastest and returns the number immediately; fax and mail using Form SS-4 also work.8Internal Revenue Service. Obtaining an Employer Identification Number for an Exempt Organization

Adopt Bylaws and a Conflict of Interest Policy

Minnesota law does not require a nonprofit to adopt bylaws, but as a practical matter you need them before you apply for federal tax-exempt status, because the IRS asks for them with the application.9Minnesota Office of the Revisor of Statutes. Minnesota Statutes 317A.181 – Bylaws Workable bylaws usually cover:

  • Board structure: number of directors, how they are elected, their terms, and how vacancies get filled.
  • Officer roles. Minnesota requires every nonprofit to have at least the functions of a president and a treasurer, though you can use different titles.10FindLaw. Minnesota Statutes 317A.301 – Officers Required
  • Meeting procedures: frequency, quorum, notice, and voting.
  • Membership classes, if the organization will have voting members.
  • An amendment process. Certain amendments, such as changing board size, quorum rules, or how directors are removed, require approval by voting members if adopted by the board.9Minnesota Office of the Revisor of Statutes. Minnesota Statutes 317A.181 – Bylaws

The IRS also looks for a conflict of interest policy. It is not legally mandated, but Form 1023 asks whether you’ve adopted one and includes a sample in the instructions. A workable policy requires directors and officers to disclose any personal financial interest in a proposed transaction, step out during deliberation, and let only disinterested directors vote on it. Each director should sign an annual statement confirming they’ll follow it.11Internal Revenue Service. Instructions for Form 1023

Apply for Federal 501(c)(3) Status

Federal tax-exempt status lets your nonprofit receive tax-deductible contributions and avoid federal income tax on revenue tied to its mission. You apply through Pay.gov using one of two forms.12Internal Revenue Service. About Form 1023-EZ, Streamlined Application for Recognition of Exemption Under Section 501(c)(3)

Form 1023-EZ or the Full Form 1023

Form 1023-EZ is shorter and cheaper, but it is only available if your organization meets all of these conditions:13Internal Revenue Service. Instructions for Form 1023-EZ

  • Projected annual gross receipts of $50,000 or less in each of the next three years.
  • Annual gross receipts that have not exceeded $50,000 in any of the past three years.
  • Total assets with a fair market value of $250,000 or less.

Exceed any of those thresholds and you file the full Form 1023, which requires a detailed narrative of planned activities, the populations you’ll serve, funding sources, and where you’ll operate.

User Fees and the Determination Letter

The IRS charges a non-refundable fee of $275 with Form 1023-EZ and $600 with Form 1023.2Internal Revenue Service. Form 1023 and 1023-EZ: Amount of User Fee After review, and often after a request for more information, the IRS issues a determination letter recognizing your 501(c)(3) status. The streamlined form is generally faster. Keep the letter permanently; you’ll need it for state tax filings, charitable registration, and to prove exempt status to donors and vendors.

Apply for Minnesota Tax Exemptions

Federal exempt status does not automatically exempt you from Minnesota taxes. You apply separately to the Minnesota Department of Revenue.14Minnesota Department of Revenue. Special Exemptions and Nonprofits

For sales tax exemption, submit Form ST16 along with a copy of your IRS determination letter. If approved, the Department issues an authorization letter you present to vendors when buying items like office supplies, equipment, and furniture tax-free. Not every nonprofit qualifies; the exemption is most often granted to organizations focused on education or direct services.

Register With the Attorney General Before You Fundraise

Most charitable organizations that solicit donations in Minnesota must register with the Attorney General’s Office before any fundraising begins. The initial registration statement includes your organization’s legal name, the names and compensation of officers and directors, the purposes for which you’ll solicit, and a copy of your IRS determination letter.15Minnesota Office of the Revisor of Statutes. Minnesota Statutes 309.52 – Statement Requirement The initial fee is $25.16Office of Minnesota Attorney General. Charities Information

Some organizations are exempt from this requirement under Minnesota Statutes Section 309.515:17Minnesota Office of the Revisor of Statutes. Minnesota Statutes 309.515 – Exemptions

  • Small organizations receiving $25,000 or less in total annual contributions, where all fundraising is done by unpaid volunteers and no assets or income benefit any officer.
  • Religious organizations exempt from filing a federal annual information return.
  • Accredited educational institutions under the Minnesota commissioner of education, the Minnesota State Colleges and Universities system, or the University of Minnesota, among others.
  • Fraternal, professional, trade, and similar membership societies that only solicit contributions from their own voting members.
  • Small private foundations that solicit from no more than 100 people per year.

The small-organization exemption disappears the moment you hire a professional fundraiser. At that point registration and annual reporting are mandatory regardless of how little you raise.

Plan for Annual Compliance From Day One

Starting the nonprofit is the beginning of a recurring filing cycle. Three deadlines are worth knowing before you launch.

Every Minnesota nonprofit corporation must file an annual renewal with the Secretary of State by December 31 each year. There is no fee, but missing it can lead to involuntary dissolution of the corporation.18Office of the Minnesota Secretary of State. Business Filing and Certification Fee Schedule

Registered charities must file an annual report with the Attorney General’s Office. For calendar-year organizations the deadline is July 15; for fiscal-year filers it’s the 15th day of the seventh month after year-end. Attach the IRS Form 990 (or the applicable shorter version) and pay a $25 fee. A $50 late fee applies if you miss the deadline. The report must be approved by board resolution and signed by two officers.19Office of Minnesota Attorney General. Registration and Reporting – Charities and Charitable Trusts

At the federal level, nearly all 501(c)(3) organizations must file an annual return (Form 990, 990-EZ, or the 990-N e-Postcard, depending on size) by the 15th day of the fifth month after fiscal year-end. For calendar-year organizations that is May 15. Three consecutive missed filings and the IRS automatically revokes your exempt status, which means losing the ability to receive tax-deductible contributions until you re-apply and bring the delinquent returns current.20Internal Revenue Service. Automatic Revocation of Exemption for Non-Filing – Frequently Asked Questions Build these dates into your calendar the same week you receive your determination letter.