How to Start a Nonprofit Organization in Minnesota | Attorney Aaron Hall
Minneapolis Business Attorney Aaron Hall, Minnesota

How to Start a Nonprofit Organization in Minnesota

There are two stages to consider when creating a nonprofit organization in Minnesota: first, drafting and filing the legal documents required to create a nonprofit organization, and second, applying to the IRS for 501(c)(3) status, if desired.

Stage 1: Form a Minnesota Nonprofit Organization

Articles of Incorporation

To create a Minnesota nonprofit organization, you need to file Articles of Incorporation with the Minnesota Secretary of State. Please note that if you intend to seek 501(c)(3) status with the IRS, there is specific language that you need to use in your Articles of Incorporation to comply with IRS requirements, and that language is not included in the standard form provided by the Minnesota Secretary of State. The exact required language will depend on the type of organization and its mission.


A nonprofit organization is also required to have Bylaws. Our laws are essentially the rules inside the organization and often cover issues like the election of directors, who can be a member of the organization, how officers are selected, the role of the president of the nonprofit, and other principles under which the Minnesota nonprofit will operate.

Stage 2: File Reports with the Minnesota Attorney General

In general, nonprofit organizations soliciting contributions must file an “Initial Registration / Annual Report Form” and an annual report with the Office of Minnesota Attorney General. You can find these forms here: Minnesota Nonprofit and Charity Forms. This is required by Minnesota Statutes section 309.53. However, there are exceptions for small organizations that meet the exemptions (exclusions) noted in Minnesota Statutes section 309.515.

Stage 3: Apply for 501(c)(3) Status (Optional)

Once you have formed a Minnesota nonprofit organization, the next step is to determine whether you want to apply for 501(c)(3) status. Obtaining 501(c)(3) status provides a number of benefits including being able to receive donations from other 501(c)(3) organizations and individual donors being able to receive a charitable tax deduction for their donation to your organization.

The application for seeking 501(c)(3) status is IRS form 1023. Most people who look at IRS form 1023 are overwhelmed by the daunting amount of information required. Our law firm has received many calls from people who attended who apply for 501(c)(3) status on their own and later sought the help of a Minnesota nonprofit attorney because they couldn’t figure out the application or the IRS rejected their application due to problems in the application. If you want to apply for 501(c)(3) status on your own, the IRS provides some guidance: 501(c)(3) application process.

Very small nonprofit organizations may want to consider whether it is worth obtaining 501(c)(3) status in light of the work and attorney’s fees associated with the process. For small nonprofit organizations, the cost to form a nonprofit organization and get legal guidance in completing the form to seek 501(c)(3) status is often $1,500 to 3,000, depending on the complexity of the organization and the time the organization’s staff are willing to spend (versus delegating the work to the attorney).

How Much Does It Cost?

The federal application fee (filing fee for IRS Form 1023) is generally under $1,000.

Attorneys’ fees can vary depending on the firm you select and the complexity of your nonprofit organization. For example, a small poverty organization would be on the low end, and a hospital would be on the high end.

My firm offers a low fixed fee to form a standard (minimal customizations) Minnesota nonprofit organization in compliance with federal tax law while remaining available to assist with preparing IRS Form 1023 at the usual hourly rates (depending on the complexity of the matter). Usually clients…

  1. hire me for one hour to instruct them on how they can complete Form 1023 themselves,
  2. do most of the work on Form 1023 themselves, then
  3. hire me to review their nearly completed form, draft sections they could not complete, and make a few revisions.

On average, it takes approximately 3-6 hours finalizing Form 1023 after a client has made best efforts preparing it.

Final Considerations

If you are considering starting a Minnesota nonprofit organization, the first step is to talk to people who are interested in the cause. A Minnesota nonprofit organization needs at least three people to serve on the Board of Directors. The law permits you to serve on the Board of Directors and the president and director of the organization at the same time, so you will need at least two others to serve on the Board of Directors.

Although many people who were on nonprofit organizations consider it their organization, from a legal perspective, the organization is owned by the public and merely in trust to you under your control. This means you must keep your personal finances separate from the organization’s finances, you will never receive profit from the organization except a fair market value compensation for your services as a wage, and when the nonprofit ends, everything it owns (its assets) must be donated to other nonprofit organizations in accordance with the law.

shawn says April 25, 2012

I am less than an average Joe. In a matter of 8 months I went from having a family in a home, member of church, proud father, healthy, etc. to homeless and trying to survive. I have cried on deaf ears to every resource available to me within my limitations. And it has me thinking are there others that have gone through what I have. I am an African american 36 year old, father of five Minnesota resident, wanting to make a change. I split with my ex wife, and I met someone else. My ex-wife then got a no contact order on me and included our son. A judge granted her request and I was ordered no contact with my child for three months. I want to help dads who want to be in their childs life. every place I called only had help for mothers and it was honestly upsetting and frustrating. this is only the beginning please contact me at 612 354-0380 Shawn.
also can an average Joe with no money start a non profit? If not what if the idea was so creative and something new, could an average guy like myself get a sponsor or partner to invest through community? thank you for your time 612 354-0380 Shawn.

michael phelan says May 3, 2013

My company does work inside and outside the USA involving bio-mass based energy production (green energy), I intend to establish a non-profit to develop job opportunities and education here and overseas. would a 501c3 be the appropriate choice, we are faith based and contribute from our operations to the UPC church (

Can I complete this process this year, we should have at a minimum of 50K in money contributed this year.

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