Getting ready to start a nonprofit is no small feat—and if you’re reading this, you’re probably someone with a big heart and a bold vision. Whether you’re passionate about feeding families, fostering the arts, protecting the environment, or creating community spaces—your cause matters. And in order to bring that cause to life and sustain it, your organization needs to be set up the right way.
While the paperwork may not be as exciting as launching your first program or seeing your mission in action, it’s a crucial first step. A properly established nonprofit can apply for grants, accept tax-deductible donations, and be recognized as a trusted and credible organization.
This article outlines what you need to know if you’re thinking of starting a nonprofit in Michigan.
You can complete many of these tasks online, however, starting with a legal partner who has experience in setting up nonprofits will ensure everything is done correctly. Contact
Cornerstone Legal today to get your nonprofit started.
Email us at katrina@cornerstonelegalpllc.com or call (517) 708-2222.
How to Start a Nonprofit
Step 1: Establish a Nonprofit Corporation at the State Level
Before you can do anything else, your nonprofit must be legally recognized as a nonprofit corporation in the State of Michigan. This involves filing Articles of Incorporation with the state and, most importantly, including your mission statement in that filing.
Your mission statement should clearly explain your organization’s purpose, values, and goals—it will guide every decision you make and must also be included in other important documents, including your Bylaws and IRS filings. Check out Define Your Mission – Create a Mission Statement on crafting a mission statement.
Step 2: Assemble Your Board of Directors
Michigan law requires your nonprofit to have at least three directors, and each must be 16 years of age or older. Your board is your leadership team—they’ll help you govern, fundraise, and steer the ship. Choose wisely!
Step 3: Draft Your Bylaws
Your Bylaws are like the operating manual for your organization. They need to include your mission statement and meet specific IRS requirements to be eligible for tax-exempt status. This document outlines how decisions are made, how meetings are held, and how leadership is structured.
Nonprofit Bylaws Examples
YMCA
Habitat for Humanity
United Way
Boys and Girls Clubs of America
Step 4: Get an EIN (Employer Identification Number)
You’ll need an EIN from the IRS—even if you won’t have employees right away, or ever. This number is essentially your nonprofit’s Social Security number for tax purposes and is required before you can file for tax-exempt status.
NOTE: You should not have to pay a fee when filing for a Tax ID number. If you are asked to do so, you are on the wrong website.
Step 5: Apply for Tax-Exempt Status
Most new nonprofits can file the 1023-EZ form online to apply for federal tax-exempt status. But first, you’ll need to complete the IRS Eligibility Worksheet to make sure you qualify. Once approved, your organization can receive tax-deductible donations and become eligible for many public and private grants.
Step 6: Register with the Michigan Attorney General’s Charitable Trust Section
Before you start asking for donations in Michigan, you must register with the Michigan Attorney General’s Charitable Trust Section, unless your organization qualifies for an exemption.
NOTE: This step is often overlooked—but it’s required for compliance if you’re fundraising in the state.
Step 7: Stay in Compliance Year After Year
Setting up your nonprofit is just the beginning. To keep your nonprofit in good standing, you’ll need to:
- File IRS Form 990 every year by May 15th (this is your annual tax return).
- Submit an Annual Statement to the State of Michigan.
- Renew your registration each year with the Michigan Attorney General’s Charitable Trust Section, if you’re registered.
Your Cause Deserves a Solid Foundation
We know that getting all these pieces in place can feel overwhelming—but we’re here to help. At Cornerstone Legal, we’ve guided many purpose-driven people through the process of forming a nonprofit and building something that lasts. From your first document to your first donation—we’ve got your back.
Contact Cornerstone Legal today for all your nonprofit needs.
Let’s build something that makes a difference—together.
Email us at katrina@cornerstonelegalpllc.com or call (517) 708-2222.
