How to Start a Nonprofit in North Dakota

Before You Begin

Sustaining an organization with sufficient human and financial resources in the long term can be a challenge. Start with some background research.

  • When deciding whether to establish a nonprofit organization, answer these questions:
    • Would the organization compete with another nonprofit organization? If so, should the other organization be supported instead of establishing a second organization?
      • Ways to find out about active North Dakota nonprofits:
        • NDANO Members: Use our searchable membership directory to find members working in diverse mission areas across North Dakota.
        • Tax Exempt Organizations: The IRS provides a search tool to help individuals find information about a tax-exempt organization’s federal tax status and filings.
        • Nonprofits in North Dakota are required to register with the Secretary of State. You can use their FirstStop Portal business records search to find nonprofits registered in North Dakota.
    • What would be the organization’s strategic plan?
    • What would be the organization’s business (i.e., financial) plan?
    • What talent and expertise would the initial board of directors bring to the organization?
    • What would be the name of the nonprofit corporation or LLC?
      • Determine if the preferred name is available by using the business records search on the Secretary of State’s FirstStop Portal. A name will not be able to be used if it is the same as, or deceptively similar to, a name already reserved or registered with the Secretary of State.

 

Next Steps: Following Legalities

This material is intended for general information purposes only and does not constitute legal advice. Anyone intending to start a nonprofit is encouraged to seek advice from an attorney or accountant.

  • Draft articles of incorporation. See IRS Publication 557, Appendix for sample articles. *
    • The Secretary of State’s FirstStop Portal has an online form that includes all the articles information required by state law. You can use this form or self-draft articles. The online form only supports the provisions required by state law.
    • The articles of incorporation must be signed by one or more incorporators (corporation) or organizers (LLC).
  • Register your nonprofit organization with the Secretary of State.
    • The filing requires article information, as well as choosing a nonprofit structure (corporation or LLC), requested nonprofit name, and registered agent. The registration filing fee is $40.
    • Each year nonprofits are required to submit an annual report by Feb. 1 to maintain good standing with the Secretary of State. If a nonprofit is also registered as a charitable organization, it must submit two separate annual reports each year: a Nonprofit Annual Report and a Charitable Organization Annual Report. Learn more on the Secretary of State’s Maintain a Nonprofit page.
  • Schedule an organizational board meeting *
    • When the Secretary of State has officially approved the nonprofit registration filing, the incorporators (corporation) or organizers (LLC) should conduct an organizational meeting to elect the initial board of directors (if not named in the articles).
    • The Board of Directors should:
      • Authorize the appropriate person to APPLY online for an employer identification number.
      • Approve bylaws.
      • Elect officers.
      • Adopt a resolution or motion to authorize an officer or employee to open appropriate bank accounts.
      • Adopt a resolution or motion to authorize an officer or employee to APPLY for 501(c)(3) tax-exempt status or make appropriate arrangement with a fiscal sponsor.
        • If affiliated with a faith-based organization, the nonprofit may be authorized to obtain a 501(c)(3) tax-exempt status under the faith-based organization’s group exemption.
        • The IRS grants income tax exemptions to different types of nonprofits, including 501(c)(3) or charitable organizations (whose contributions from donors qualify for federal charitable income tax deductions). When granted an IRS exemption, North Dakota nonprofit corporations are also exempt from paying state income tax. North Dakota also governs sales and property tax exemptions, if applicable, for nonprofit corporations.
        • Some nonprofits utilize a fiscal sponsor as they get started, instead of immediately filing the IRS paperwork.
      • If you going to be soliciting contributions, authorize an officer or employee to determine if your nonprofit needs to register as a charitable organization with the Secretary of State.
      • Approve a budget
      • Adopt appropriate written policies: *
        • Conflict of Interest Policy
        • Whistleblower Policy
        • Document Retention and Destruction Policy
        • Process for determining compensation of key employees
        • Internal controls

*Legal References:

  • Organization names: N.D.C.C. § 10-33-11.
  • Articles of incorporation: N.D.C.C. § 10-33-05; § 10-33-06; § 10-33-08
  • Organizational board meeting/elections: N.D.C.C. §§ 10-33-25, N.D.C.C. § 10-33-26, 10-33-27, 10-33-28, 10-33-29, and 10-33-20, § 10
  • -33-49.
  • Adopt appropriate written policies:
    • Conflict of Interest Policy – see IRS Form 990, Part VI, Section B, 12a.
    • Whistleblower Policy - see IRS Form 990, Part VI, Section B, 13.
    • Document Retention and Destruction Policy - see IRS Form 990, Part VI, Section B, 14.
    • Process for determining compensation of key employees - see IRS Form 990, Part VI, Section B, 15.

 

Additional Resources