How to Start a Nonprofit Organization in North Dakota 2024

Establishing a nonprofit is kind of similar to forming a corporation in North Dakota. You can easily start a nonprofit in North Dakota as a limited liability company, a corporation, or any other type of business structure. Unlike for-profit businesses, nonprofits focus on addressing pressing social issues than profit-oriented businesses.

This article will guide you through the Dos and Don’ts of starting a nonprofit in North Dakota. LLCBuddy editors explain all the steps you must follow to form a corporation for your nonprofit organization. It must be noted that this page shared generalized steps to form a nonprofit in North Dakota. It is recommended to consult an attorney or hire a professional service.

What is a Nonprofit in North Dakota

Nonprofit organizations are legal entities that operate to serve public benefits and address community issues. Unlike for-profit organizations, nonprofits do not aim to generate any profit. The Internal Revenue Service (IRS) generally exempts nonprofit organizations from tax. However, based on the business entity structure, you will receive tax exemptions as a nonprofit.

In North Dakota, ensure you have a community issue to address before forming your nonprofit. It can generally be education, religion, charity, social service, or other social issues. Nonprofits do not pay taxes on the money they receive through fundraising programs, donations, or any charitable funding.

Types of Nonprofits in North Dakota

The first thing one has to decide is what type of nonprofit structure one wants. There are several types of nonprofits one can start. Here is a list of nonprofit types one can choose from-

Nonprofit LLC
Nonprofit Corporation
Unincorporated Nonprofit

BOI Report Filing

According to the Corporate Transparency Act, every LLC, corporation, and other type of business that is registered with the North Dakota SOS or similar authority, must file the BOI report with FinCEN. From January 1, 2024, it is mandatory to file a BOI report for every business entity. In this report, LLCs have to share information about the beneficial owners (having equal or more than 25% share). LLC owners can file BOI reports online or offline.

Businesses in North Dakota that are created before January 1, 2024, should file their BOI report by January 1, 2025. Businesses that are created in 2024, must file the BOI report within 90 business days of finishing the formation process. Missing out on filing the BOI report may lead to a monetary penalty of $500/day.

How to Start a Nonprofit in North Dakota

Nonprofits are certainly different from for-profit organizations. The main focus of the organization is on social values rather than profit. The process of having a nonprofit in North Dakota is similar to forming any corporation in North Dakota. However, there are a few additional steps to follow.

Step 1: Develop Your Mission and Vision

Before you get into legal details, you need to define the purpose and goal of your organization clearly; this will go a long way in guiding your decisions as well as making it easy for you to explain your mission statement.

Pick out what specific cause or issue you want to address;
Define who you will target or help reach particular goals;
List down both what people should do within a short period and what they should achieve in the long term perspective;
Write a captivating mission statement.

Step 2: Name Your Nonprofit in North Dakota

Naming a business in North Dakota has a handful of regulations. If you start a corporation or an LLC in North Dakota, you must follow those regulations to name your nonprofit. The most important rule is to check if the name is available in North Dakota to use.

If you’re forming an LLC in North Dakota for your nonprofit organization, check out LLC naming guidelines in North Dakota. For the corporation regulations, read on how to start a corporation in North Dakota. As soon as the name is decided, you can reserve it with the North Dakota Secretary of State. You can also file DBA in North Dakota before you establish your nonprofit organization. DBA can be filed in two methods, by mail and in person.. The DBA filing fee in North Dakota is $25.

Online DBA Filing: There is no online filing available
Offline DBA Filing: For filing offline, you must send the accomplished DBA filing form to the North Dakota Secretary of State, 600 E. Boulevard Ave., Dept. 108, Bismarck, ND 58505-0500 or drop it off in person at the same address.
DBA Renew Time in North Dakota: five years

Step 3: Appoint Initial Board Members

If you’re forming a corporation for your North Dakota nonprofit, it is required to appoint the initial board members. In North Dakota, you need at least Three unrelated directors to start the organization. If you don’t choose a minimum of Three directors, it will automatically become a member-managed corporation.

Step 4: Get North Dakota Registered Agent

This is a very important step for any business in North Dakota. The Registered Agent in North Dakota is a person who conducts all types of documentation between the State and your nonprofit organization. The Registered Agent must be from North Dakota, above 18 years of age, and must have legal rights to conduct business in the state. Several professional and business formation services offer registered agent services in all the states in the USA. It is better to hire a professional rather than being your own Registered Agent in North Dakota.

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Step 5: File Articles of Incorporation with North Dakota SOS

This is the most important step in forming a nonprofit corporation in North Dakota. File your Articles of Incorporation with the North Dakota Secretary of State. You can file your nonprofit corporation through two methods, online and by mail. Submit the details of your nonprofit corporation, like the name of the nonprofit, address, name and address of the registered agent, operation dates, directors’ details, and more information related to your company.

Online Incorporation: Create an account/Log in to the SOS site, get the online form, fill it, and submit online
Offline Incorporation: Send the form by mail to Secretary of State, State of North Dakota, 600 E Boulevard Avenue Dept 108, Bismarck ND 58505-0500
Incorporation Fee in North Dakota: $100 for online and by mail filing

Hiring a professional service might be a wise idea here. Having a corporation is much more complex than forming an LLC. We recommend ZenBusiness as they are one of the top business service providers currently. They offer LLC formation at $0 in North Dakota.

Step 5.1: Write Company Bylaws

As soon as you file the formation documents, it is time for the company bylaws. The directors and board members must decide how the meetings, elections, voting, and other corporate activities will be held. These bylaws must comply with the North Dakota state law. It is similar to an LLC operating agreement in North Dakota for the LLC owners.

Step 6: Get an EIN in North Dakota

The next step is to obtain the EIN in North Dakota. The employer identification number (EIN) is required to conduct business in North Dakota. You will need to acquire the North Dakota EIN from the official IRS website. To obtain the EIN, submit your application to the IRS office either by mail or through their online platform. There is no associated cost for this process.

Step 7: Tax Exemptions for Your Nonprofit

When you start a nonprofit in North Dakota, you enjoy tax exemptions. As the nonprofits are not profit-oriented, they get a huge tax exemption from Federal and State authorities.

Federal Tax Exemption

You must submit Form 1023 to the IRS to file for federal tax exemption. This form, titled “Application for Recognition of Exemption Under Section 501(c)(3) of the Internal Revenue Code,” is required for all nonprofit corporations. Smaller nonprofits have the option to file Form 1023-EZ instead. You will be prompted to provide details about your organization upon obtaining the relevant form. Complete the form with the necessary information and submit it. The filing fees are $600 for Form 1023 and $275 for Form 1023-EZ.

State Tax Exemption

Once you get the Federal Tax Exempt, it is time for State Tax Exempt. In North Dakota, you must apply for the tax exemption to the North Dakota Office of State Tax Commissioner. Get the form, fill it up with the correct details, and send it to the office. You may need to pay a fee along with the form and supportive documents to apply for the State Tax Exemption. You need an Exemption Certificate to apply for the state tax exemption. Read North Dakota classification of taxes to learn more about the North Dakota tax structure.

Can I form an LLC for my Nonprofit in North Dakota?

Yes, you can form an LLC in North Dakota to run a nonprofit. Establishing an LLC nonprofit in North Dakota requires similar documents and paperwork. Except for tax exemption applications that one must file with the state tax and revenue department. LLCs must file Form 1023 with the North Dakota Office of State Tax Commissioner to get the tax exemption.

After You Form a Nonprofit Corporation in North Dakota

Once your nonprofit is formed, there are additional steps to complete:

Get necessary licenses: As soon as your corporation or an LLC for your Nonprofit in North Dakota will be established, get necessary licenses and permits. Check with the local authority/government to get the local permits.
Get Insurance for the North Dakota Nonprofit: You must get workers’ compensation and unemployment insurance if you have employees. Based on your nonprofit structure, you might need general liability insurance, property, vehicle, auto insurance, etc.
Get a Business Bank Account: You must get a business account for all types of business-related transactions in North Dakota. You may need different documents based on the bank and place of business. Check with the bank for it.
File Nonprofit as Charity: This is optional. Your nonprofit is either for charity purposes or any purpose that meets your community’s needs. If your organization is for charity purposes, then you can file your nonprofit as a charity to enjoy tax exemptions.
Other Business Compliances: You may need additional compliances based on your nonprofit type. Check with your attorney or local authority for more information.
Evaluating And Improving Performance: To evaluate the performance of your non-profit organization, it is necessary to; establish performance metrics also tied to the mission; and implement continuous improvement strategies.
Staying Current With Nonprofit Trends And Best Practices: To stay up-to-date on trends and best practices in the non-profit world you should join nonprofit associations plus networks.

Common Challenges And How To Address Them

Funding Sustainability

For funding sustainability issues you need to focus on diversifying funding sources and developing strong relationships with donors. Also, implementing efficient financial management, exploring earned income opportunities for sustainability, and such should be on focus.

Volunteer Management

The challenges faced in volunteer management can be resolved by creating clear roles plus expectations for volunteers, and providing adequate training also support. Recognize and appreciate volunteer contributions while implementing volunteer retention strategies such as offering regular appreciation events or awards. Provide trainers’ placement services too.

Mission Drift

This problem can be solved by several mechanisms such as regular review and reaffirmation of your organizational mission–this will ensure that all activities are aligned with the core purpose. Educate board members and staff about the importance of the mission and make them understand how this works out in practice. Implement a strategic planning process and explain to the board why it is important for their organizations to have a well-defined mission.

Regulatory Compliance

To remain compliant with the law, you need to: keep track of changing laws and regulations all the time; conduct regular compliance audits; seek professional advice when in doubt; and implement comprehensive record-keeping systems.

Names of Nonprofit Corporations in North Dakota

Following are some of the Nonprofit Organizations in North Dakota. The contact information of these organizations can be found on North Dakota Secretary of State portal.

Hettinger Charities
Hillsboro Charities
Hope Charities
Horace Charities
Jamestown Charities
Kenmare Charities
Killdeer Charities
Kindred Charities.

FAQs

How do I start a nonprofit organization in North Dakota?

To start a nonprofit organization in North Dakota, you need to file the necessary paperwork with the North Dakota Secretary of State and the IRS.

What are the requirements for registering a nonprofit in North Dakota?

Nonprofits in North Dakota must have a registered agent with a physical address in the state, a unique name that is not already in use, and a board of directors.

How long does it take to start a nonprofit in North Dakota?

The timeline for starting a nonprofit in North Dakota can vary, but it typically takes a few weeks to a few months to complete all the necessary steps.

What is the cost of starting a nonprofit in North Dakota?

The cost of starting a nonprofit in North Dakota includes filing fees with the Secretary of State and possibly fees for legal assistance in drafting required documents.

Are there any specific regulations for nonprofits in North Dakota?

Nonprofits in North Dakota are regulated by the North Dakota Secretary of State and must comply with state nonprofit laws.

Can I apply for tax-exempt status for my nonprofit in North Dakota?

Yes, nonprofits in North Dakota can apply for federal tax-exempt status with the IRS by filing Form 1023.

What are the benefits of being a nonprofit in North Dakota?

Benefits of being a nonprofit in North Dakota include eligibility for tax-exempt status, access to grants and donations, and a sense of legitimacy.

How do I recruit board members for my nonprofit in North Dakota?

To recruit board members for your North Dakota nonprofit, you can reach out to local community members, professionals, and other individuals who have a passion for your cause.

Do I need to have a physical office for my nonprofit in North Dakota?

Nonprofits in North Dakota are not required to have a physical office, but they must have a registered agent with a physical address in the state.

How do I come up with a mission statement for my nonprofit in North Dakota?

To come up with a mission statement for your North Dakota nonprofit, consider the purpose of your organization, the population you serve, and your long-term goals.

Can nonprofits in North Dakota engage in political activities?

Nonprofits in North Dakota can engage in some political activities, as long as they do not endorse specific candidates or parties.

How can I attract donors to my nonprofit in North Dakota?

To attract donors to your North Dakota nonprofit, focus on telling your organization’s story, engaging with potential donors on social media, and hosting fundraising events.

Are there resources available to help nonprofits in North Dakota?

Nonprofits in North Dakota can access resources from the North Dakota Association of Nonprofit Organizations and various state agencies.

How do I create a budget for my nonprofit in North Dakota?

To create a budget for your North Dakota nonprofit, consider your operating expenses, fundraising goals, and revenue streams.

Is it necessary to have insurance for my nonprofit in North Dakota?

While it is not required by law, it is recommended that nonprofits in North Dakota have liability insurance to protect the organization and its board members from lawsuits.

How can I promote my nonprofit in North Dakota?

To promote your North Dakota nonprofit, utilize social media, community events, and networking opportunities to increase visibility and attract supporters.

Can nonprofits in North Dakota hire employees?

Yes, nonprofits in North Dakota can hire employees, but they must comply with state labor laws and regulations.

How do I dissolve a nonprofit in North Dakota?

To dissolve a nonprofit in North Dakota, you must file the appropriate paperwork with the state, settle any outstanding debts, and distribute assets to other nonprofits or charitable organizations.

Can nonprofits in North Dakota apply for grants?

Yes, nonprofits in North Dakota can apply for grants from foundations, government agencies, and other funding sources to support their programs and services.

What is the process for changing the name of my nonprofit in North Dakota?

To change the name of your nonprofit in North Dakota, you must file an amendment with the North Dakota Secretary of State and update your organization’s records with the IRS.

How do I stay compliant with state regulations as a nonprofit in North Dakota?

To stay compliant with state regulations, nonprofits in North Dakota should keep accurate financial records, file annual reports with the Secretary of State, and adhere to their bylaws.

Can I appoint myself as the registered agent for my nonprofit in North Dakota?

Yes, you can appoint yourself as the registered agent for your nonprofit in North Dakota, as long as you have a physical address in the state where you can be reached during business hours.

How do I conduct fundraising events for my nonprofit in North Dakota?

To conduct fundraising events for your North Dakota nonprofit, you must obtain any necessary permits from local authorities, promote the event to potential donors, and ensure that funds are properly managed and accounted for.

Can my nonprofit in North Dakota engage in lobbying activities?

Nonprofits in North Dakota can engage in lobbying activities, but there are limits on the amount of lobbying they can do without jeopardizing their tax-exempt status.

What is the process for applying for North Dakota sales tax exemption for my nonprofit?

To apply for North Dakota sales tax exemption for your nonprofit, you must file Form ST3 with the North Dakota Office of State Tax Commissioner and provide documentation of your tax-exempt status.

Are there specific fundraising regulations for nonprofits in North Dakota?

Nonprofits in North Dakota must comply with state regulations regarding charitable solicitation, including registering with the Secretary of State and reporting fundraising activities annually.

How can I expand the reach of my nonprofit in North Dakota?

To expand the reach of your North Dakota nonprofit, consider partnering with other organizations, leveraging social media and online platforms, and hosting community events to raise awareness of your cause.

Can my nonprofit in North Dakota engage in for-profit activities?

Nonprofits in North Dakota can engage in some for-profit activities, such as selling merchandise or services, as long as the profits are used to support the organization’s charitable mission.

What steps are involved in starting a nonprofit in North Dakota?

In North Dakota, you must file articles of incorporation, obtain an Employer Identification Number (EIN), and apply for tax-exempt status with the IRS.

Do nonprofits in North Dakota have to register with the state?

Yes, nonprofits in North Dakota must register with the Secretary of State’s office.

In Conclusion

Starting a Nonprofit corporation in the North Dakota takes careful thought, dedication, and detailing. Follow the steps detailed in this guide while addressing common challenges so that your organization can be built on solid ground and make a long-lasting impact on your cause. Remember also that running a nonprofit organization in North Dakota is a perpetual learning, adapting, and growing process.

As you continue your journey, you may need professional help. Having a professional or experienced person, or attorneys while you run your nonprofit in North Dakota can make the journey much simpler in the long run. Since forming a nonprofit involves tax exemptions, the government takes additional care to verify your background.

Donations, charity, and several community services are the most desirable ways to evade tax. Hence, many people get involved in nonprofit organizations. It is recommended to consult a legal professional, accountants, and service providers like ZenBusiness for the paperwork and formation process. With persistence, passion, and proper management structure everything is possible hence changing positively your community as far as Non-Profit corporations are concerned.