Here are the steps to form a nonprofit corporation in Michigan. You should read this page in conjunction with the general section on forming a nonprofit corporation, which has additional steps listed that are applicable to all states. You should also familiarize yourself with chapter 45 of the Michigan Compiled Laws (abbreviated here as "Mich. Comp. Laws"), and with the Michigan Department of Licensing and Regulatory Affairs.
1. Choose a business name and check for availability
- Your nonprofit corporation's name may not be the same as, or deceptively similar to, other corporate names on file with the Secretary of State (limited exceptions apply).
- See the Department of Licensing and Regulatory Affairs's Name Availability resource for more information.
2. Recruit and/or appoint directors
- You must have at least three directors for your nonprofit corporation.
- Directors do not have to reside within the state of Michigan.
- Directors may be sixteen or seventeen years old, but the nonprofit corporation then faces certain requirements on quorum and the articles of incorporation.
- See Mich. Comp. Laws § 450.2501 and Mich. Comp. Laws § 450.2505 for more information.
3. Incorporate your Nonprofit Organization
You should read the general section on forming a nonprofit corporation in tandem with the steps outlined here.a. Prepare and file articles of incorporation with the Secretary of State
- Articles of Incorporation for Nonprofit Corporations explains what to include in your articles in order to qualify for 501(c)(3) tax-exempt status.
- You must file your articles of incorporation with the Michigan Secretary of State.
- The filing fee is $20.
- Click here for a sample articles of incorporation.
- See the Michigan Secretary of State's Review Procedures manual for more detailed information on how to draft an articles of incorporation.
- Note that you must file an Annual Report with the Secretary of State every two years after your date of creation. The filing fee is $20, and the information required on the report is basic business information, such as the names of all officers and directors and the business's principal location.
b. Create the bylaws
- There are no set criteria for the content of bylaws, but they typically set forth internal rules and procedures.
- You are not required to file bylaws with the Secretary of State, but you must keep a copy at the nonprofit corporation's principal place of business.
- Refer to Bylaws for Nonprofit Corporations for general information.
c. Hold an organizational meeting
- See Forming a Nonprofit Corporation for details.
d. Create a Records Book
- You will need a records book to store important documents concerning your nonprofit corporation.
- See Mich. Comp. Laws § 450.2485 for specific information about record-keeping requirements under Michigan law.
4. Get your Employer Identification Number
Whenever you hire an employee in Michigan, you must inform both the IRS and the state of Michigan.
a. Federal
- Request an Employer Identification Number ("EIN") from the IRS. This can be done via an online application.
- For more on the EIN, see Forming a Nonprofit Corporation.
- The IRS details all of the necessary steps to complete, including verifying work eligibility and withholding allowances certificates, in Hiring Employees.
b. State
- See Michigan New Hire Reporting Center for more information.
5. Register with state offices
a. The Attorney General's office
- You may need to obtain a Charitable Solicitation License from the Michigan Attorney General.
- First, complete an Initial Charitable Solicitation Questionnaire and send it to the Charitable Trust Division, with a copy of your articles of incorporation, bylaws, and your IRS determination letter, if you have one.
- If the Attorney General's office determines that the license is necessary, file an Application for License to Solicit Donations annually.
- In general, a license is required if you raise more than $8000 per year and pay someone for fundraising services.
b. Department of Revenue
- You must register for taxes using the Business Tax e-Registration website where you will find forms and instructions for all business taxes.
- See the Michigan Business Taxes Registration Booklet for more information.
6. Apply for tax exemptions
Once you've incorporated as a nonprofit corporation, you can start applying for tax exemptions.a. Federal
- The IRS lists a series of questions to help you determine whether your organization is eligible for federal tax exemption.
- See Applying for 501(c)(3) Tax Exemption for more information on how to apply for tax-exempt status under section 501(c)(3) of the tax code.
b. State
- Once you receive your federal 501(c)(3) exemption your nonprofit corporation will automatically be exempt from the Michigan Single Business Tax (a tax that combines state corporate income taxes and certain other taxes into a single tax).
- While optional, you may want to file Form C8030: Single Business Tax Notice of No SBT Return Required with the Michigan Department of Treasury.
- To claim the sales exemption, give sellers/vendors a completed copy of Form: 3372: Certificate of Exemption for their records.
c. Local
- See Forming a Nonprofit Corporation for details.