If you are starting a 501(c)(3) nonprofit in Minnesota, you have come to the right place. After following the easy steps for Minnesota nonprofit formation, follow this guide to help keep your Minnesota nonprofit compliant and protected.
In this guide we cover:
How to Protect Your Minnesota Nonprofit
Get Business Insurance
As with any other business, there may be risks involved in running the nonprofit. Getting insurance for your nonprofit allows you to focus on your passion while minimizing your liability.
Here are some of the common types of insurance you may want to consider for your organization:
- General Liability Coverage
- Directors and Officers Coverage
- Social Service Professional Coverage
Your coverage needs will vary based on your organization and the work you do.
Properly Sign Legal Documents
There will be times when you will be signing a document on behalf of your nonprofit. It is important that these times are easily distinguishable from when you are signing a document as an individual. If a document isn’t properly signed, you might suddenly find yourself personally responsible for something the organization should have been liable for.
To avoid such confusion we recommend you and all the members of your organization follow the following format:
- The official name of your nonprofit
- Your signature
- Your full legal name
- Your position in the organization
How to Keep Your Minnesota Nonprofit Compliant
Maintain A Minnesota Registered Agent
To update the secretary of state about changes to registered agent/office information file a Change of Registered Office/Registered Agent form. This form can be mailed to the address found below:
Minnesota Secretary of State – Business Services
Retirement Systems of Minnesota Building
60 Empire Drive, Suite 100
Saint Paul, MN 55103
For more information, you can call the Secretary of State at (651) 296-2803.
File Required Periodic Reports
The Secretary of State requires all nonprofits to submit an annual renewal once every year by Dec 31st. This form can be mailed to the address found below:
Minnesota Secretary of State - Business Services
Retirement Systems of Minnesota Building
60 Empire Drive, Suite 100
St Paul, MN 55103
Determine Minnesota Business Permits and Licenses
As a nonprofit in the state of Minnesota, your organization will not need a general business license. However, there may be licensing requirements for your city or county. Access the Minnesota e-License Portal for more information.
If your nonprofit will be hosting charitable gambling of any kind (raffles, bingo, etc.), you must apply for the appropriate license or permit. Access the Minnesota Gambling Control Board’s website for complete details.
For more information, you can call the Gambling Control Board at (651) 539-1900 or visit them at the address found below:
Minnesota Gambling Control Board
1711 County B Rd W # 300S
Roseville, MN 55113
If your nonprofit is a charity, and it will be soliciting charitable contributions, you must contact the Minnesota Attorney General. Depending on the specific purpose of your organization, you will either need to register as a charitable organization or file for an exemption. These forms can be mailed to email@example.com. The filing fee is $25 and can be paid by credit card.
For more information, you can call the Office of the Attorney General at (651) 757-1311, visit them at their website, or visit their office at the address found below:
Office of the Attorney General
1200 Bremer Tower
445 Minnesota Street
St. Paul, MN 55101-2130
If your organization will have employees you must do the following
- Register with the Minnesota Unemployment Insurance unit
- Register for a tax ID with the Department of Revenue
- Report all new hires to the reporting center
1. Minnesota Unemployment Insurance
For more information, you can call Minnesota's Unemployment Insurance Customer Service at (651) 296-6141, visit them at their website, or write to them at the address below:
Minnesota UI Customer Service
PO Box 4629
St. Paul, MN 55101-4629
2. Department of Revenue
Your organization should register for a Minnesota Tax ID to obtain an employer withholding account.
For more information, you can call the Department of Revenue at (651) 282-9999, visit them at their website, or visit their office at the address found below:
Minnesota Department of Revenue
600 N. Robert St.
St. Paul, MN 55101
3. New Hire Reporting Center
In addition, all new hires must be reported through the Minnesota New Hire Reporting Center.
Public Inspection Rules for all 501(c)(3) Organizations
All organizations that have been granted the 501(c)(3) status are required to disclose the following documents to the public when requested:
- Annual returns for 3 years after the due date (this includes returns like Form 990, 990-EZ, 990-PF, and any Forms 990-T)
- All Form 990 Schedules (except portions of Schedule B), attachments and supporting documents.
- Application of exemption and all supporting documents such as Form 1023
- The official paperwork from the IRS that shows that your organization has tax-exempt status.
The following do NOT need to be shared with the public
- Portions of schedule B of Form 990/990-EZ that identify the contributors. (You only need to disclose the amount contributed and the nature of the contributions)
- Any unfavorable rulings such as an earlier denial of tax-exempt status.
- Any information the IRS has said you can withhold. This may include things like sensitive patents and trade secrets.
How long do I have to produce these documents if requested?
Ideally within the same day. If your organization doesn’t have an office or maintains limited hours during parts of the year, the information should be made available within two weeks.
Do I need to provide copies of the documents?
If someone asks for copies in person or in writing you must provide them with copies.
Can I charge for copies?
You can charge a reasonable amount for making copies of the documents requested.
NOTE: It may be easiest to have the documents available on your website so that anyone who requests copies can be sent to the site. This allows you to stay compliant without having to spend a lot of time dealing with document requests.
Annual Returns for Tax-Exempt Organizations
Most tax-exempt nonprofit organizations are required to file an annual return with the IRS (Check the list of exceptions).
Which form you should use to file the annual returns depends on the annual gross receipt amounts for your organization.
"Gross receipt" is defined by the IRS as “the total amounts the organization received from all sources during its annual accounting period, without subtracting any costs or expenses”
- For gross receipts ≤$50,000 --- File 990-N
- Gross receipts <$200,000 and total assets <$500,000 --- File 990- EZ
- Gross receipts >$200,000 or Total assets >$500,000 --- File 990
For any questions, you can call the IRS at
- (800) 829-3676 (Form-related questions)
- (800) 829-1040 (General information)
When is form 990 due?
You have a little over 4 months after your taxable year comes to an end to file Form 990. It is due on the 15th day of the 5th month. So if your taxable year ends on Dec 31st, your form 990 is due on May 15th.
NOTE: If your organization fails to file form 990 for 3 consecutive years, it will automatically lose its tax-exempt status.
Report Unrelated Business Income
If your Minnesota organization has a gross income of ≥$1000 from a trade or business that is not related to the stated purpose of the organization, then it must file Form 990-T to pay tax on that income.
If you expect to pay $500 or more for the year in taxes on unrelated business income, your organization must pay a quarterly estimated tax on the unrelated business income using Form 990-W.
If your nonprofit corporation has unrelated business income, you will need to Form M4NP (Minnesota Franchise Tax). The appropriate year’s form can be found at the Minnesota Department of Revenue.
For more information, you can call the Minnesota Department of Revenue at (651) 556-3075 or email them at firstname.lastname@example.org.