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INDEX OF LAWS INDEX OF LAWS

 

Initial License

Annual Renewal

 

Initial License

Renewal

 

Charitable Auctions
Charitable Games (Bingo, Raffles, Texas Hold-em Tournaments , Las Vegas Nights)
Dinners, Dances
Door-to-Door Solicitations
Golf Outings
Internet Solicitations
Telephone Solicitations
Vehicle & Boat Donations

 


Charitable Games (Bingo, Raffles, Texas Hold-em Tournaments , Las Vegas Nights)
Telephone Solicitations
Vehicle & Boat Donations

 

 



 

 

 

Initial License 

 

Charitable Organizations and Solicitations Act Requirements

This law requires charities that either solicit or receive charitable contributions in Michigan to file a charitable solicitation registration with the Department of Attorney Generalís Charitable Trust Section.  Some organizations are exempt from the requirement.

Exemptions include:

  • charities that solicit or receive less than $25,000 in contributions in any 12-month period, so long as it is an all-volunteer organization with no paid staff person engaged in helping to solicit or receive funds
  • churches, religious organizations and organizations that are an integral part of a church
  • private foundations or other organizations that solicit contributions only from members, directors, or members of the families of those persons, AND the organization does not invite or encourage members of the general public to contribute or become members of the organization
  • schools / educational institutions that have been authorized to operate by the Michigan Department of Education or the State Board of Education
  • veterans' organizations that have been chartered by Congress
  • charities that receive funding only from one other licensed charitable organization such as a supporting organization
  • licensed hospitals and hospital based foundations and hospital auxiliaries that support only one or more licensed hospitals
  • organizations that are licensed by the Department of Human Services as day care or other organizations providing service to children and families
  • those solicitations that are to benefit one or more named individuals or families (Such solicitations would not be considered charitable solicitations under federal or state law, but the Act does contain a specific exemption for them.)

 

The Charitable Trust Section will assist organizations with a determination of the need for the organization to obtain a license. They will review the structure and activities of the charity and will notify the charity if any exemptions apply. 

 

New Organizations and First-Time Filers

All new filers should complete and submit either the Initial Solicitation Registration form, along with all requested attachments, or a Request for Exemption if the organization thinks that one of the specific exemptions in the law may apply. Each of the forms has a Checklist in the instructions pages listing required information and attachments that must be included with the submission.


For more information go to the Charities Page of the Attorney General's website.

 

Annual Renewal of the Charitable Solicitation Registration

The charitable solicitation registration expires each year approximately seven months following the end of the organization's fiscal year.  You will be notified of the expiration date when you receive notice that the Charitable Trust Section has approved the license application.  Make a note of this date.

 

The Renewal Solicitation Registration form must be submitted to the Charitable Trust Section 30 days prior to the expiration of the license, along with all required information and attachments.


The Charitable Trust Section will also accept the national multi-state form, the Unified Registration Statement. This is a form that is accepted by almost all states that require licensing or registration for charitable solicitations, including Michigan. The form can be found on the Multi-State Filer Project website.


For more information go to the Charities Page of the Attorney General's website.  

 

Professional Fundraisers

Another requirement of the Charitable Organizations and Solicitations Act is that any person, corporation, organization, or other entity that is compensated in any way for planning, conducting, managing or carrying out solicitation of contributions for a charity must obtain a professional fundraiser license from the Attorney General's Charitable Trust Section. To obtain the license, complete and submit the Application for License of Professional Fund Raiser along with a $10,000 bond. There is no license fee. To read more about the procedures and requirements and for links to all of the forms you will need go to the Charities section of the Attorney General's website.

 

Employers and officers of the charity are not considered professional fundraisers unless part or all of their compensation is based on the amount of funds raised. For example, if an development director were paid bonuses based on the success of fundraising efforts, then that person would need to be licensed as a professional fundraiser.

 

 


 

Initial License 

 

Another requirement of the Charitable Organizations and Solicitations Act is that any person, corporation, organization, or other entity that is compensated in any way for planning, conducting, managing or carrying out solicitation of contributions for a charity must obtain a professional fundraiser license from the Attorney General's Charitable Trust Section. To obtain the license, complete and submit the Application for License of Professional Fund Raiser along with a $10,000 bond. There is no license fee. To read more about the procedures and requirements and for links to forms and further explanations of requirements go to the Charities section of the Attorney General's website. In addition to the Application for License of Professional Fund Raiser, the following forms are needed to complete the application to obtain a professional fundraiser license:

Employers and officers of the charity are not considered professional fundraisers unless part or all of their compensation is based on the amount of funds raised. For example, if an development director were paid bonuses based on the success of fundraising efforts, then that person would need to be licensed as a professional fundraiser.

 

Professional Solicitors

Those individuals who are hired by licensed professional fundraisers to conduct solicitations -- those who make phone calls or go door-to-door -- must be registered with the Charitable Trust Section. There is a one-page Registration of Professional Solicitor form to be completed and submitted for each individual solicitor.

 

 Professional Fundraiser License Renewal 

 

Professional Fundraiser licenses expire on June 30 each year. The renewal application is the same as the form for applying for the initial professional fundraiser license the Application for License of Professional Fund Raiser. Other forms listed below that may need to be submitted are also available on the Charity Section of the Attorney General's website.

  • Contract Summary Sheet, if there are new contracts for which a summary sheet has not yet been submitted
  • Campaign Financial Statement, which must be submitted by fundraisers who have access to, or control of charity funds
  •  Uniform Professional Fund Raiser Surety Bond, which must be completed by the surety company and submitted along with the Application



 

 

There are many kinds of fundraising and solicitation activities that charities may choose to conduct. Below many of these activities are listed, with links to other websites and to pages on this website where additional information can be found. Please note that charities conducting these solicitation and fundraising activities must apply for a charitable solicitation license, unless they are specifically exempted from the requirement. See the section above on applying for a charitable solicitation license from the Attorney General's Charitable Trust Section. Also, if professional fundraisers are used to help carry out these activities, they may need to obtain a Professional Fundraiser License from the Attorney General's Charitable Trust Section. See the section above for information on Professional Fundraiser Licenses.


Charitable Auctions 


There is no separate law that regulates charitable auctions aside from the charitable solicitation licensing requirement. Because the organization will be selling merchandise, the organization will be required to pay 6% sales tax on the items sold. Sales tax applies only to the fair market value of the item, not for the total auction bid. The charity may need to obtain a license from the State of Michigan to allow them to collect the sales tax from the purchaser/winning bidder. To find out more about Sales Tax, go to the section below on State and Local Taxes or go directly to the State of Michigan, Department of Treasury website. 

Because auctions are not games of chance, they are not regulated by the State's Charitable Gaming Division, which regulates Bingo, raffles and other gaming activities.


Charitable Games (Bingo, Raffles, Texas Hold-em Tournaments , Las Vegas Nights)


These events involve games of chance that are subject to licensing by the Michigan Department of Lottery, Charitable Gaming Division. To learn more about the licensing requirements and a list of training sessions, go to the Charitable Gaming Division website.
The section below on Charitable Gaming also has information and links.

Dinners, Dances 


Most dinners sponsored by charities as fundraisers or celebrations are either handled by professional caterers and establishments that already comply with food handling requirements. However, if the charity conducts such activities on their own, check with the local Environmental Health or Community Health agency or go to the Michigan Department of Agriculture webpage to learn about requirements and licenses. Note that potlucks operated by charities that serve homemade foods are exempt from the licensing requirement.

If the charity engages in the sale of alcoholic beverages
they may need to obtain a special liquor license for the event. The Special Liquor License Application form provides information to answer many of the questions. The Liquor Commission's FAQs for Special Liquor Licenses also answers questions you may have.

Door-to-Door Solicitations 


Before conducting door-to-door solicitations, check with local government agencies for local ordinances that prohibit or regulate such activities.

Golf Outings 


Even though participants pay to participate in golf events, the charity may still be subject to the charitable solicitation license requirement, since the charity usually solicits sponsors, prizes and other donations to help carry out the event. Also, a donation may be a part of the fee for participating. While most events are conducted at a golf course that already has the required food handling and liquor licenses, it is important to note that, if the charity is directly involved in these activities, then they may need to obtain their licenses. The Special Liquor License Application form provides information to answer many of the questions. The Liquor Commission's FAQs for Special Liquor Licenses also answers questions you may have.

Internet Solicitations


Charities that solicit donations through their own websites or websites of other organizations or businesses must apply for a charitable solicitation license if they wish to obtain contributions from Michigan donors. If a Michigan organization solicits contributions by way of websites, it will be presumed that the charity intends to solicit Michigan donors and will accept contributions from Michigan donors. If an organization does not wish to apply for the Michigan charitable solicitation license, then any web solicitations should contain a clear message that no contributions will be accepted from Michigan donors and that the organization does not intend to solicit Michigan donors. If the organization is located in Michigan, however, registration as a charitable trust will still be required. See the section below for rules and procedures for charitable trust registration.

Telephone Solicitations


Telephone solicitations are subject to Attorney General oversight. Charities that solicit contributions through telephone solicitations must apply for a charitable solicitation license. Any professional contractor who conducts, manages or plans a telephone solicitation campaign must obtain a professional fundraiser license; individual solicitors who work for those fundraisers must also register as professional solicitors.

Vehicle & Boat Donations


Charities that solicit donations of cars, boats or other merchandise are subject to the charitable solicitation license requirements of the Attorney General. Some vehicle donations in Michigan qualify for tax credits. For more information fo to the
Michigan Department of Treasury website.

 

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Charitable Games (Bingo, Raffles, Texas Hold-em Tournaments , Las Vegas Nights)

 

It is important to know that Bingo, raffles, sweepstakes or other charitable gaming activities are not considered charitable activities under federal or state laws. Even though the funds raised through these activities are used to carry out charitable activities and purposes, the activities are not charitable.

 

Charitable gaming activities may subject a charity to unrelated business income tax (UBIT), excise taxes or other tax liabilities. There are also federal reporting requirements concerning charitable gaming activities. To learn more about these requirements and possible tax liabilities, go to IRS Publication 3079. Gaming Publication for Tax-Exempt Organizations. Some organizations must file IRS Form 730.



Telephone Solicitations

 

The Telemarketing Sales Rule (TSR) was amended in 2003 to provide for the Do Not Call Registry and other changes to increase consumer protections for those who are solicited by businesses by telephone. While charities are exempt from checking to Do Not Call Registry and may call citizens who are listed on the registry, there are provisions of the TSR that do apply to charities. For information on what charities and their fundraisers must do to comply with the TSR, go to the Complying with the Telemarketing Sales Rule page of the Federal Trade Commission (FTC) website. A more expansive document that discusses rules that apply to charities and exemptions from the Do Not Call Registry can also be found in the Report to Congress submitted by the FTC.


Vehicle & Boat Donations

 

The IRS website explains rules for vehicle donations, the information that charities need to know, as well as information for donors as to what amount they can deduct on their income tax forms. IRS Publication 4302, A Charity's Guide to Vehicle Donations also provides guidance.

 

Because the laws have changed in the past few years, if there is a conflict between information in the publication and information on the IRS website, you should contact the IRS (1-800-829-3676) for up to date information.

The IRS also provides Publication #4303, A Donor's Guide to Car Donations


NOTE:  Donors should be informed that they may need to submit IRS Form 8283 along with their tax return for the year they are claiming the donation.