If you live in Minnesota and decide to start a charity, make sure you do not rush into it. Setting up such an organization requires planning. It takes time, energy and knowledge of the state’s charitable legislation. It is also imperative, you understand any federal laws pertaining to the setting up and running of your nonprofit organization. Only after you have a clear grasps of all that is involved, will you have an understanding of how to start a charity in this state.
First Thoughts
Before you actually advance to a serious planning stage, it is important you consider whether this is the right and best option. The state is home to almost 34,000 nonprofit organizations. They cover everything from providing meals for the elderly to helping fund the arts. You need to ask yourself and your group a few questions including:
- What would your organization do?
- What is its primary focus?
- What specific group or groups of individuals would they provide services to or help for?
- What other groups offer virtually identical or at least similar services or aid? Would there be any overlapping?
- Would you and the organizers have the time, energy and interest to stay with the charity for the long haul?
You and your group need to resolve these basic issues before you even consider other aspects of how start a charity.
The Process Begins
While each charitable organization is different, they do need to follow certain steps to become recognized as a charity in Minnesota. The initial formation requires the selection of the directors for this first incarnation. In this state, you must have a minimum of three individuals. They will help you choose a name and work with you on incorporation papers.
Upon incorporating, you have to file the Articles of Incorporation with the state. Talk to a lawyer to make sure you utilize the right form, include the applicable material and express in the appropriate language your intent to obtain tax-exempt status from the IRS – 501(c)(3).
Formation of the charitable organization will also require bylaws for your group. You will need to document specifics including:
- When to hold meetings
- How often to hold meetings
- Procedural actions during meetings
- Rules concerning the elections of specific officers and directors
You will not submit these to the Minnesota Secretary of State. These bylaws are for internal review and application only.
How to Start a Charity
Setting up and running a charity in Minnesota is a complex issue. It requires planning and forethought. It involves interacting with government officials on both the state and federal level. If you want to make sure your plan on how to start a charity does not become a rejected and undisciplined mess from which you can only painfully extricate yourself, talk to a lawyer first.
