Michigan Nonprofit Bylaws
Your bylaws act as the operating manual for your Michigan nonprofit corporation. Your bylaws define your members’ rights and responsibilities and establish the rules for governing your organization. For example, your bylaws explain the official procedures for holding meetings, electing officers, and maintaining records. Adopting bylaws is an essential part of your nonprofit’s formation process—robust bylaws will help keep your organization running smoothly and prevent internal conflicts.
Start creating your bylaws today with our attorney-drafted nonprofit bylaws template.
Why does a Michigan nonprofit need bylaws?
Although you’re not required to submit your nonprofit bylaws to the Michigan Department of Licensing and Regulatory Affairs with your Michigan Articles of Incorporation, your bylaws are still incredibly important. Your bylaws are the primary governing document for your Michigan nonprofit. It’s also very likely that your bylaws will end up on the public record. Here are the key reasons to take drafting your bylaws seriously.
1. Nonprofit bylaws are legally required in Michigan.
In MCL § 450.2231, the Michigan state legislature states that bylaws “shall be adopted,” meaning that domestic nonprofit corporations are legally required to adopt bylaws. We recommend keeping the most current version of your bylaws on file at all times.
2. Third parties will ask to see your bylaws.
Third parties such as banks, landlords, and partnering organizations will often ask to see your bylaws before doing business or making financial arrangements with your nonprofit. Notably, you’ll also need to send a copy of your bylaws to the IRS if you seek tax-exempt status.
3. Nonprofit bylaws allow you more control over your nonprofit.
Your bylaws can help safeguard your nonprofit against legal entanglements. How? Your bylaws should lay down clear rules for handling situations where disagreements among members may arise, such as adding or removing board members and dealing with conflicts of interest. Without such regulations in place, the potential for disputes among your members increases. If members take legal action against your nonprofit or if the state decides to investigate a dispute, you could end up involved in legal battles that drain your resources and tarnish your reputation. Protect against negative consequences with comprehensive bylaws.
Want to learn more? Check out our Guide to Nonprofits.
What do Michigan Nonprofit Bylaws include?
Your Michigan nonprofit bylaws should provide basic details about your organization, such as its name, address, and purpose. Your bylaws should also contain the specific rules for your nonprofit’s internal operations, including:
- adding or removing board members
- giving notice and holding board meetings
- taking a vote and meeting quorum requirements
- handling conflicts of interest
- compensating directors
- keeping records
- amending the bylaws
- operating during emergencies
- dissolving the nonprofit
Your bylaws’ adopters can add provisions that apply specifically to your organization as long as these provisions don’t violate the law or your nonprofit’s articles of incorporation.
Are nonprofit bylaws legally binding?
Yes, your nonprofit bylaws constitute a legally binding agreement on how your members will run your organization. If any member of your nonprofit breaches this contact, both the individual involved and your nonprofit as a whole could be held liable in a court of law.
Are nonprofit bylaws public record?
This depends on your nonprofit. Because you don’t need to submit your bylaws to the state, it’s possible to keep your bylaws private. However, most nonprofits’ bylaws become public. Why? The most common reason is that the IRS requires nonprofits to submit copies of their bylaws with applications for 501(c)(3) tax-exempt status, and the IRS makes all of these applications public. Many nonprofits also publish their bylaws to demonstrate transparency.
Do nonprofit bylaws need to be signed?
No, there is no legal requirement for your board of directors to sign your bylaws in Michigan. That being said, it’s customary for your board to sign your bylaws. Getting your board’s signatures lends your bylaws an air of authority and makes it clear that your directors agree about the direction of your nonprofit.
Can nonprofit bylaws be changed?
Yes. In Michigan, your incorporators, board, or members “may amend or repeal the bylaws” and even “adopt new bylaws” if necessary (MCL § 450.2231) unless your nonprofit’s articles of incorporation or bylaws state otherwise. We recommend including a provision in your bylaws for making amendments. This will (a) clarify amendment procedures and (b) help prevent disagreements between members regarding the process.
Who adopts nonprofit bylaws?
According to Michigan state law, your nonprofit’s incorporators, board, or members can adopt its bylaws (MCL § 450.2231). It is standard practice to adopt bylaws at your nonprofit’s first organizational meeting.