At a Glance

South Dakota is one of the few states that doesn’t require charitable solicitation registration for fundraising activities. However, certain activities like raffles still require advance notice to local governing bodies, and organizations fundraising in other states will need to register in those jurisdictions.

Understanding South Dakota’s Unique Approach

South Dakota stands apart from most states when it comes to charitable solicitation registration requirements. Unlike the complex registration processes many nonprofits face across the country, charitable solicitation in South Dakota follows a different path. In fact, South Dakota is one of the few states that doesn’t require formal charity registration for fundraising activities. However, this doesn’t mean your nonprofit can ignore all compliance considerations. Certain activities might still trigger the need for notices or other legal requirements.

Understanding these unique rules doesn’t have to be complicated. Whether you’re launching a new nonprofit or expanding your fundraising efforts into South Dakota, this step-by-step guide will walk you through everything you need to know. We’ll clarify what counts as solicitation, when you might need to file notices despite the general exemption, and how to stay compliant while fundraising across state lines.

Step 1: Understand What Charitable Solicitation Means

Before you plan your fundraising strategy, it’s essential to grasp exactly what constitutes “charitable solicitation” in the fundraising world. Fundamentally, charitable solicitation refers to any activity where you ask for a donation—regardless of the method or medium used. This encompasses any attempt to raise funds from an individual, group, or the general public. This definition has expanded over time to include virtually all revenue-generating activities for nonprofits.

Many states consider the act of asking for support—not just receiving donations—as the trigger for registration requirements. While many states require charities to register before soliciting funds, South Dakota does not impose such a requirement. The regulatory landscape continues to evolve, with many states now treating almost all forms of nonprofit revenue generation as solicitation activities, regardless of the source. Essentially, if you’re asking for something of value to support your charitable mission, you’re engaging in solicitation.

Examples of fundraising activities that count

• Traditional approaches: Direct mail campaigns, telephone calls, in-person meetings, and presentations
• Digital fundraising: Website “Donate Now” buttons, email campaigns, social media fundraising, and online crowdfunding
• Events and gatherings: Fundraising galas, golf tournaments, silent auctions, and even dual-purpose events that combine programming with fundraising
• Grant seeking: Applying for grants is considered solicitation in many states
• Passive methods: Some states consider having donation capabilities on your website to be solicitation activity

Additionally, some activities you might not immediately recognize as solicitation often fall under this umbrella, including membership dues collection, program revenue from product sales, participation fees, and occasionally even unsolicited donations.

Why this matters for compliance

Understanding what constitutes solicitation is crucial because fundraising activities are regulated by state laws. These laws exist primarily to protect donors from unregistered, misleading, or fraudulent fundraising activities.

Furthermore, non-compliance with applicable charitable solicitation requirements can result in serious consequences, including financial penalties and late fees, civil and criminal actions against officers and directors, revocation of tax-exempt status, prohibition from soliciting funds, and loss of donations or other revenue.

For organizations fundraising across multiple states, the complexity increases significantly. Each state has its own rules and definitions regarding what triggers registration requirements. Online fundraising especially complicates matters, as a simple “Donate” button on your website might be considered solicitation in many states that have registration requirements.

Consequently, many nonprofits work with experienced charitable registration specialists to navigate these complex multi-state regulations with confidence. Though South Dakota doesn’t require registration, your organization might still need to register in other states where you solicit donations, particularly with the borderless nature of internet fundraising.

Public trust ultimately stands as the most valuable currency for any nonprofit organization, and maintaining proper compliance forms the foundation of that trust.

Step 2: Confirm South Dakota’s Registration Requirements

South Dakota offers a refreshing exception to the complex web of nonprofit regulations across the United States. Understanding these requirements—or lack thereof—will save you time and resources as you plan your fundraising strategy.

No registration required for charitable solicitation

South Dakota stands as one of the few states nationwide that does not mandate charitable solicitation registration. This means your nonprofit can legally solicit donations from South Dakota residents without filing specific charity registration paperwork with state authorities.

This regulatory approach sets South Dakota apart from the many other states that require charities to register before fundraising. For many nonprofits, this represents a significant administrative advantage, as you can focus your resources on your mission rather than compliance paperwork.

Nevertheless, the absence of registration requirements doesn’t mean total freedom from regulatory oversight. Your organization should still:

• Maintain accurate financial records
• Honor donor intent for restricted gifts
• Provide appropriate donation receipts
• Follow general business and nonprofit laws
• Fulfill IRS requirements for tax-exempt status

When notice or other rules might still apply

Even without charitable solicitation registration requirements, certain fundraising activities may trigger other obligations:

Gaming activities (raffles and similar events): South Dakota law requires written notice to the local governing body (municipality or county) at least 30 days before selling any raffle tickets, and if tickets are sold statewide, written notice must also be provided to the Secretary of State.

Professional fundraisers: Organizations using paid solicitors or professional fundraising counsel must follow specific rules, even though the charity itself isn’t required to register for solicitation.

Specialized fundraising: Campaigns collecting funds for specific regulated purposes (such as certain gaming activities) may face additional requirements beyond standard charitable solicitation rules.

Local permits: Some municipalities within South Dakota may have their own ordinances regarding solicitation, particularly for door-to-door fundraising or special events.

If your fundraising extends beyond traditional donation requests, consulting with experienced charitable registration specialists can help identify any potential triggers specific to your activities.

Out-of-state nonprofits and business qualification

For organizations based outside South Dakota, additional considerations apply:

Foreign qualification: If your out-of-state nonprofit conducts substantial activities in South Dakota beyond mere fundraising, you may need to “foreign qualify” with the Secretary of State. This process establishes your legal authority to operate in the state and typically requires:

• Filing a Certificate of Authority application
• Appointing a registered agent with a physical address in South Dakota
• Submitting a certificate of good standing from your state of incorporation
• Paying the required filing fee

Multi-state fundraising: While South Dakota doesn’t require registration, many other states do. If your organization solicits donations nationwide or uses online fundraising methods (websites, email, social media), you’ll likely need to register in multiple jurisdictions.

Modern fundraising technologies effectively erase state boundaries, creating complex compliance challenges. Many nonprofits utilize specialized charitable registration services to navigate these requirements, ensuring they remain compliant across all states where they solicit.

Maintaining exemptions: Even though South Dakota doesn’t require initial registration, maintaining proper records and following best practices remains vital. Your organization should document any applicable exemptions in case questions arise about your fundraising activities.

Ultimately, while South Dakota offers a more streamlined approach to charitable solicitation, incorporating this knowledge into your broader compliance strategy enables you to fundraise confidently both within and beyond state borders.

Step 3: Check for Exemptions and Special Cases

Even in South Dakota’s relaxed regulatory environment, certain organizations and activities merit special attention. Understanding these exceptions ensures your nonprofit remains fully compliant with all applicable laws.

Religious and educational organization exemptions

Religious organizations enjoy significant exemptions throughout South Dakota’s legal framework. The South Dakota Constitution specifically mandates that property used “exclusively” for religious purposes must be exempt from taxation. This exemption extends to buildings used exclusively for religious purposes, clergy housing, parking lots owned by religious societies, and educational plants operated by religious organizations.

Moreover, religious organizations benefit from sales tax exemptions on receipts from religious activities, provided the entire amount is used for religious purposes and the activity doesn’t last more than three consecutive days. For religious activities at county fairs, this exemption extends to five consecutive days.

Educational institutions likewise receive consideration under South Dakota law. Most universities qualify for federal tax exemption under IRC Section 501(c)(3). However, it’s crucial to understand that tax-exempt status differs from fundraising registration exemptions. While South Dakota doesn’t require charitable registration, educational institutions fundraising in other states should verify their exemption status in each jurisdiction.

Grant-only fundraising and its implications

Organizations that exclusively seek grants instead of public donations face unique considerations. Generally, grant applications are considered solicitation in many states, but since South Dakota doesn’t require charitable solicitation registration, this distinction primarily affects multi-state operations.

For organizations operating beyond South Dakota, understanding the distinction between grant-seeking and public fundraising becomes vital. Many states treat grant applications as solicitation, requiring registration before applying for funding opportunities.

Do gaming and raffle events trigger registration?

While South Dakota doesn’t mandate general charity registration, raffles and gaming events operate under specific rules:

• Provide at least thirty days’ written notice of the time and place of the raffle to the governing body (municipality or county) where the drawing will be held before selling any tickets
• If tickets are sold statewide, provide written notice to the Secretary of State before selling any tickets, and also provide the required notice to the municipality or county hosting the drawing
• Only nonprofits and charities can legally conduct raffles

Notably, under South Dakota State Law, games of chance are generally prohibited except when specific exemptions apply. These exemptions include bingo and lotteries conducted by:

• Congressionally chartered veterans’ organizations
• Religious, charitable, educational, or fraternal organizations
• Local civic or service clubs
• Volunteer fire departments
• Political committees or candidates

Conducting bingo or a lottery in violation of SDCL 22-25-25 is a Class 2 misdemeanor. As an alternative, organizations that did not provide the required advance notice may hold silent or live auctions instead.

For nonprofits navigating these requirements across multiple states, many organizations find value in partnering with professional charitable registration specialists to ensure all compliance obligations are met correctly.

Step 4: Plan for Multi-State Fundraising

While South Dakota provides a registration-free environment, your fundraising likely extends beyond state borders. The digital nature of modern fundraising creates unique compliance challenges that require careful planning.

Why you still need to register in other states

Many states have enacted charitable solicitation statutes requiring organizations to register before soliciting their residents for contributions. Even if your nonprofit is based in South Dakota, you must comply with the registration requirements in every state where you solicit donations.

The internet fundamentally changes how registration requirements apply. A simple “Donate Now” button on your website can trigger registration obligations in multiple jurisdictions. Many states consider the act of solicitation—not the receipt of funds—as the trigger for registration requirements.

The consequences of non-compliance are substantial:

• State fines, late fees, and penalties
• Civil and criminal actions against officers and directors
• Revocation of tax-exempt status
• Denial of right to solicit funds

Beyond financial penalties, non-compliance can damage your nonprofit’s reputation and relationships with donors and grantmakers.

How to track where you’re soliciting

Understanding exactly where you’re soliciting becomes critical. Consider all your fundraising activities:

• Direct mail campaigns and email solicitations
• Social media fundraising and online donation portals
• Fundraising events and in-person appeals
• Grant applications (which count as solicitation in many states)

Many states require disclosure statements on written solicitation materials. Due to these complexities, maintaining detailed records of where donations originate helps ensure you’re registered in all necessary jurisdictions.

For organizations based in South Dakota, experienced charitable registration specialists can help identify which states require registration based on your specific fundraising activities.

Use charitable registration services to simplify the process

Many organizations find that outsourcing multi-state registration is more cost-effective than handling it in-house. Professional charitable solicitation registration providers offer several advantages:

• Comprehensive knowledge of state-specific requirements
• Management of initial registrations and renewals
• Tracking of deadlines and reporting obligations
• Minimizing the risk of errors or missed filings

Professional services like Labyrinth, Inc.’s charitable registration specialists can streamline the process, managing submissions across multiple states simultaneously with dedicated renewal management. Our experienced team handles the complex paperwork and tracks every deadline, allowing your organization to focus on its mission while maintaining full compliance across all jurisdictions.

Remember that each state has different forms, documentation requirements, filing fees, and renewal processes. Planning ahead is essential, as some states require approval before solicitation can legally begin.

Step 5: Stay Compliant with Ongoing Rules

Maintaining ongoing compliance once you begin fundraising remains crucial for nonprofits, regardless of South Dakota’s relaxed initial registration requirements.

Disclosure requirements for online donations

In 24 jurisdictions across the country, charities must include specific disclosure statements on their solicitation materials. These statements typically inform donors where they can obtain additional information about your nonprofit, either from government agencies or the organization itself.

Most importantly, charitable disclosure statements should appear on all written solicitation materials—including your organization’s website if you’re accepting online donations. For multi-state fundraising, experienced charitable registration specialists can help ensure you’re meeting disclosure requirements in each jurisdiction where you solicit funds.

Avoiding accidental solicitation

Given that merely displaying a “Donate” button on your website can trigger registration requirements in many states, nonprofits must be vigilant about accidental solicitation. Track where your donations originate to determine registration needs.

Consider these precautions:

• Request to be added to the Do Not Call list (888-382-1222) to reduce calls from for-profit telemarketers hired by other charities
• When making donations to other charities, request that your information not be shared or sold
• Keep detailed records of all contribution sources to demonstrate compliance

For organizations using paid solicitors, South Dakota requires them to register and be bonded with the Attorney General. In addition, paid solicitors must file a solicitation notice at least 30 days prior to the start of each telephone solicitation campaign and file a financial report within 90 days after a campaign ends (and annually for campaigns lasting more than a year).

Annual renewals and reporting obligations

Even without initial charity registration requirements, your nonprofit may have other ongoing state filings depending on its activities and entity status (for example, annual reports with the Secretary of State for entities that are formed or qualified in South Dakota). Requirements and fees vary by entity type and should be confirmed with the Secretary of State.

To avoid compliance pitfalls across multiple jurisdictions, many organizations utilize professional compliance specialists to manage their charitable solicitation registration and reporting requirements with dedicated renewal tracking and proactive deadline management.

Conclusion

Navigating charitable solicitation requirements presents unique advantages for nonprofits operating in South Dakota. Unlike most states, South Dakota offers a registration-free environment for fundraising activities, though certain specialized fundraising methods might still trigger obligations such as filing notices for raffles.

Nevertheless, this simplicity extends only to activities within state borders. Your organization may need to register in other states when solicitation crosses state lines. Digital fundraising essentially erases geographical boundaries, making multi-state registration a common necessity for nonprofits. A single “Donate” button on your website could potentially trigger registration requirements in many states simultaneously.

Therefore, maintaining proper compliance across jurisdictions remains vital for your organization’s reputation and legal standing. Despite South Dakota’s relaxed requirements, you still need to track donation sources, maintain accurate financial records, and follow disclosure requirements for online fundraising. Additionally, specialized activities like raffles and gaming events require specific notices regardless of the general exemption.

The complexity of these varying requirements across states makes professional registration specialists increasingly valuable. Rather than navigating this regulatory maze independently, many nonprofits partner with charitable compliance experts who provide dedicated guidance and manage multi-state obligations with reliable, accurate execution. This approach allows your team to focus on mission-driven work instead of administrative paperwork.

Above all, remember that public trust serves as your nonprofit’s most valuable asset. Proper charitable solicitation compliance forms the foundation of donor confidence, protecting both your organization and its supporters. South Dakota’s unique approach provides a compliance advantage, but comprehensive fundraising strategies require attention to all jurisdictions where you seek support.

Frequently Asked Questions