Out of 51 U.S. jurisdictions, Minnesota ranks #28 overall for its friendliness towards faith-based nonprofit organizations. Minnesota has some policies that facilitate the contributions of faith-based nonprofits, including an automatic exemption from state corporate income tax for religious organizations that have 501(c)(3) status. Minnesota, however, has some policies that are burdensome to faith-based nonprofits operating in the state, such as a broad Blaine Amendment and no RFRA.
Religious Freedom:
State Constitutional Protection of Free Exercise:
3
/5
The Minnesota Constitution has been interpreted by the Minnesota supreme court to provide stronger protections for religious free exercise or worship than the federal First Amendment.
State Religious Freedom Restoration Act:
-5
/5
Minnesota has not enacted a RFRA and has enacted nondiscrimination laws that conflict with the beliefs of many religious organizations.
Religious Freedom for Nonprofits with Public Programming:
3
/5
Minnesota’s nondiscrimination laws generally restrict religious freedom for religious organizations that offer public programming and facilities but provide accommodations or exemptions for the vast majority of religious organizations.
Religious Freedom for Faith-Based Employers:
-3
/5
Minnesota’s nondiscrimination laws related to employment have only narrow exemptions allowing religious organizations to hire co-religionists and providing other narrow accommodations or exemptions.
Protections for Religious Exercise in State of Emergency:
-3
/5
Minnesota law has no explicit constitutional or statutory protections for religious exercise during a time of emergency.
Blaine Amendment:
-5
/5
The Minnesota Constitution contains a Blaine Amendment that broadly restricts faith-based organizations’ freedom to participate in public benefit programs on the same terms as similarly situated secular institutions. Current U.S. Supreme Court precedent has rendered this language ineffective, but it could become effective in the future if Court precedent changes.
Regulatory Freedom:
Nonprofit Religious Corporation Act:
0
/5
Minnesota’s nonprofit corporation law acknowledges the ability of nonprofit corporations to incorporate for religious purposes but does not include specific provisions to protect religious nonprofits’ right to self-government in internal affairs or an option to incorporate expressly as a nonprofit religious corporation.
Standards of Conduct for Directors of Religious Organizations:
3
/5
Minnesota permits a director to, in the fulfillment of the director’s fiduciary duties, rely on the opinion of individuals who can reasonably be assumed to have expertise on a certain matter, but does not expressly allow a director to rely on guidance from religious figures within his or her faith tradition.
Charitable Registration Law:
0
/5
Minnesota generally requires charitable solicitation registration and provides a limited religious exemption for entities that are not required to file form 990 (Churches, religious orders, etc.). There are no other meaningful exemptions to the registration requirement.
Audit Requirements Pursuant to Charitable Registration:
-3
/5
As a condition of maintaining authorization to fundraise in the state, Minnesota requires the submission of audited financials from organizations with annual contributions of $750,000 or more.
Corporate Income Tax:
5
/5
Minnesota imposes a statewide corporate income tax but automatically exempts organizations with federal 501(c)(3) exempt status.
Sales and Use Tax, Sales:
-3
/5
Minnesota imposes a sales and use tax on religious organizations’ sales and only provides limited exemptions for certain items.
Sales and Use Tax, Purchases:
3
/5
Minnesota imposes a sales and use tax on religious organizations’ purchases but provides broad and comprehensive, entity-based tax exemption for 501(c)(3) religious organizations’ purchases upon application.
Property Tax:
3
/5
Minnesota imposes property tax but, upon application, generally provides an exemption to religious organizations for property used for religious and/or charitable purposes.
