Step 1) Secure Your Nonprofit Name
To secure and register your brand name it must be unique, and shouldn’t contain any restricted wording. To check for naming conflicts, conduct a business entity search through the state (if there's a conflict, you might be able to file a Consent to Use of Name Form).
Keep in mind that there are a number of state-specific naming rules, so be sure to check out the MN corporate name statutes for the finer details. If needed, you can also reserve your name through the Secretary of State.
Filing Fee: $30
Quick Note: Before you commit 100% to a name, you may also want to check that there’s a decent URL available for your organization. Use GoDaddy to search your options. If there’s a quality domain name for purchase, we advise buying it right away. Even if launching a website isn’t on your radar right now, it’s going to be soon, and you might as well nail down a domain name now.
Step 2) Appoint A Registered Agent
When starting a nonprofit, you are required to designate a registered agent to handle official documents on behalf of your organization.
They must be a resident of Minnesota, or a business entity registered with the MN Secretary of State. Either way, they must have a physical address where they’re available during normal business hours (Monday through Friday, 9 am to 5 pm).
You can designate a registered agent by electing someone within your company, hiring an outside professional, or forming your nonprofit through a service like Incfile to get a registered agent free of charge for one year.
Step 3) Select Incorporators & Directors
Now it’s time to select your nonprofit’s incorporators and directors. An incorporator is an individual responsible for “executing” the Articles of Incorporation with the state (Step 5). Pretty simple — the only real requirement is that they’re over 18 years of age.
Directors, on the other hand, have far more responsibility. For now, recruit at least 1 reliable individual to act as a temporary director. They’ll oversee the organization until you vote in permanent board members (Step 7).
This is where the process can get complex and heavy with corporate formalities, so it’s a good idea to work with a nonprofit lawyer or incorporation service to help guide you and your team. (This Guide for Charity Board Members from the MN Attorney General is also a great resource.)
Step 4) Draft Nonprofit Bylaws
Incorporated nonprofits need to have bylaws, a document that outlines how the organization is structured and governed. They’ll also articulate the mission of the nonprofit and steer its course.
Your bylaws should address the following topics (and more):
- How meetings are to be conducted, and how often
- How new officers and directors are elected, and what responsibilities they have
- How voting takes place, how disputes are handled, and how records are kept
- Adding/amending bylaws (any changes must be reported to the IRS after incorporation)
If this is foreign territory for you, you might consider using a corporate bylaws template to get familiar with this essential piece of documentation. Also, here’s a link to MN Code §317A.181, which gives you the state's position on this topic.
Step 5) File Articles Of Incorporation
Once you and your team decide it’s time to officially form the nonprofit corporation, you’ll need to file nonprofit Articles of Incorporation with the state.
Some of the information you’ll need to provide on this document includes:
- The organization’s full name
- Complete names & addresses of registered agent and incorporators
- Information about the management structure of the organization
- Contact name and phone number
Action Step: File your Articles of Incorporation with the MN Secretary of State online, in-person, or by mail.
Filing Fee: $90 in-person/online, $70 by mail
Step 6) Get A Corporate Records Book
While there’s a variety of modern ways to track and compile your nonprofit’s important data, what we’re talking about here is a physical records book where you keep copies of all your essential documents. Is this required by the state? No. But it’s a great way to stay organized, and even assert the legitimacy of your brand.
You can pick up a basic corporate records book at pretty much any office supply store or through Amazon, but we’re huge fans of corporate kits. These typically include gorgeous custom pieces like embossing seals and printed bylaws.
Step 7) Conduct Initial Meeting
Your first formal meeting with your initial directors will be an organizational meeting. You’ll need to record the minutes of this meeting and have it signed by all attending directors (consider using a corporate minutes template if you’re unfamiliar).
All of the following topics should be addressed:
- Appointment of critical officers
- Procedure for approving/amending bylaws
- Establishing a tax year and accounting period
- Approving initial transactions, committees, etc.
This is also when the nonprofit should officially adopt the bylaws drafted in Step 4.
Step 8) Get An EIN
An EIN, or Employer Identification Number, is a 9-digit number assigned by the IRS to track business entities’ financial activity. Think of it as a social security number for your nonprofit.
Having an EIN will make it possible for you to legally hire employees and open up a business bank account (Step 10). Almost every major transaction your nonprofit engages in will require an EIN, so it’s important to nail one down now.
Action Step: Get an EIN easily and completely free of charge by applying directly through the IRS website.