Michigan Charitable Solicitation Laws
The Supervision of Trustees for Charitable Purposes Act, 1961 PA 101, MCL 14.251, et seq. and the Michigan Charitable Organizations and Solicitations Act, MCL 400.271 et. seq. are the two main statutes that regulate fundraising in Michigan. Unless exempted from registration or licensing under the relevant statutes, a charitable organization must register with the Michigan Attorney Generalís office and obtain a license to solicit donations. With respect to internet solicitation of charitable contributions, Michigan generally follows the Charleston principles discussed above. The Charitable Trust Division of the Attorney Generalís Office indicates that they consider direct e-mail solicitation to be the same as direct mail solicitation for licensing purposes.
In accordance with the Michigan Charitable Organizations and Solicitations Act, organizations that either have offices in Michigan or wish to receive contributions in Michigan must obtain a license from the Attorney General Charitable Trust Section. Organizations who believe they qualify for an exemption should submit a Request for Exemption form to the Attorney General, available at: http://www.michigan.gov/documents/ag/Fillable_Exemption_Form_2-9-09_Final_266603_7.pdf.
Initial Application Requirements
Charitable Organizations that are not exempt and have never filed with the Charitable Trust Section must complete and submit the Initial Registration Statement/Initial Solicitatoin Registratoin Form(http://www.michigan.gov/documents/ag/Fillable_Initial_App_2-9-09_266590_7.pdf) form along with the following requested attachments:
- Michigan corporations must submit by-laws. Out of state corporations must submit copies of the articles of incorporation along with all amendments and bylaws.
- Unincorporated entities must attach constitutions, bylaws, or other organizing documents.
- Organizations with tax-exempt status from the Internal Revenue Service (IRS) must provide a copy of the IRS determination letter.
- Copy of the most recently filed Form 990/Form 990-EZ/Form 990-PF/Form 990-N. For newly created organizations that have not filed any Form 990, financial information must be provided in the first renewal registration.
- Organizations that have had financial activity must submit a recent financial accounting.
- Copies of all contracts with professional fundraisers.
Alternatively, organizations that solicit in more than one state may file the Unified Registration Statement (URS).
License Renewal Requirements
The charitable solicitation license expires each year seven (7) months following the close of the organizationís fiscal year. The expiration date will be stated on the issued license. In order to renew the license, the organization must submit a Renewal Solicitation Registratoin Form (http://www.michigan.gov/documents/ag/Fillable_renewal_app_Final_2-9-09_266595_7.pdf), along with the required attachments, at least thirty (30) days prior to the expiration date.
Professional Fundraiser Requirements
Professional fundraisers must complete the Application for License of Professional Fundraiser (http://www.michigan.gov/documents/f007-mast_app_license_fund_rais_40902_7.pdf) before soliciting donations. Professional fundraisers must also obtain a $10,000 bond and submit the Uniform Professional Fundraiser Surety Bond form (http://www.michigan.gov/documents/f008-mast_surety_bond_40908_7.pdf) with a power of attorney form properly signed by the surety. Finally, a Professional Fundraiser Contract Summary Sheet (http://www.michigan.gov/documents/f049mast_pro_fund_rais_contract_sum_40907_7.pdf) must be submitted for every contract entered into with a charitable or religious organization.
Individual solicitors hired to make phone calls or to solicit door-to-door are required to register by filing the Registration of Professional Solicitor form (http://www.michigan.gov/documents/f009mast_reg_prof_solicitor_40903_7.pdf). The professional fundraiser license expires each year on June 30. The license can be renewed by submitting an Application (http://www.michigan.gov/documents/f007-mast_app_license_fund_rais_40902_7.pdf) thirty (30) days prior to the expiration of the license, along with a bond continuation certificate.
The Supervision of Trustees for Charitable Purposes Act requires charitable trusts to register with the Attorney General. A charitable trust includes any person or legal entity which holds property for charitable purposes. Michigan organizations that are licensed to solicit, as discussed above, are automatically registered.
Unless the entity is exempt from registration, an entity may accomplish registration by submitting the Registration Statement and Inventory forms at http://www.michigan.gov/documents/f010-mast_reg_statemnt_40900_7.pdf.
Financial accountings must be filed with the Charitable Trust Section six (6) months following the end of each fiscal year for the registration to remain up-to-date. The accounting may be filed by sending a copy of the accounting with the IRS, the organization's certified audit, or, if a corporate trustee, an annual financial statement. An IRS 990-EZ may be used by organizations that do not already have an accounting.
Organizations that have contributions of less than $8,000 and gross receipts of less than $25,000.00 during the most recent fiscal year and hold assets valued at less than $100,000.00 at all times during that fiscal year may qualify to have the financial accounting requirement waived. A waiver will not be available until the organization has at least one financial accounting on file with the Charitable Trust Section. The Annual Waiver Report Statement must be submitted to obtain a waiver. This statement may be obtained by calling the Charitable Trust Section. Despite an approved waiver, the Attorney General may request financial accountings if questions arise.
Exemptions From Licensing and Registration Requirements
Under some circumstances, an organization will be exempt from the licensing and registration requirements. Organizations who believe they qualify for an exemption should submit a Request for Exemption form to the Attorney General, available at: http://www.michigan.gov/documents/ag/Fillable_Exemption_Form_2-9-09_Final_266603_7.pdf
The following organizations are exempt from both licensing under the Charitable Organizations and Solicitations Act and registration requirements under the Supervision of Trustees for Charitable Purposes Act:
- Organizations that request contributions for the relief or benefit of an individual, so long as the individual is named at the time of the solicitation and no one is compensated for the fundraising services;
- Educational institutions certified by the Michigan Board of Education;
- A veterans' organization incorporated under federal law;
- A hospital licensed in Michigan;
- A school booster organization operating with the knowledge and approval of an educational institution;
- A governmental unit or instrumentality;
- An advocacy or lobbying organization associated with an advocacy organization, political party, candidate or committee;
- Religious organizations or a group affiliated with and is an integral part of a religious organization; or
- Organizations that do not have 501(c)(3) status and whose principal purpose is not charitable but that solicits from time to time for a charitable purpose.
The following organizations are exempt from only the licensing under the Charitable Organizations and Solicitations:
- Organizations that only receive contributions from its members, directors and their immediate families;
- Organizations whose sole source of funding is another charitable organization which holds a current charitable solicitations license;
- A hospital-based foundation or auxiliary that solicits contributions solely for 1 or more hospitals licensed in Michigan;
- Organizations that do not intend to solicit and receive, and actually do not receive, contributions in excess of $25,000.00 during any twelve (12) month period, if all of its functions are carried on by persons who are unpaid and if the organization makes its financial statement for the most recent fiscal year available to the public;
- A nonprofit corporation whose purpose is the owning and operating of facilities for aged and chronically ill that is under the sole control of a religious or fraternal organization; or
- An organization at least 50% of whose activities are licensed by the Michigan Department of Human Services to serve children and families.
The following organizations are exempt from only the licensing under the Supervision of Trustees for Charitable Purposes Act:
- An organization incorporated in a state other than Michigan that will never hold assets in Michigan;
- An organization that receives operating funds from United Way;
- An amateur theatre, band, orchestra, chorale or dance organization; or
- A trust that does not have a current charitable interest.
There are no filing fees associated with registering as a charitable trust or obtaining a charitable solicitation license.