Starting a homeless shelter requires meeting financial, practical and political challenges. The practical challenges include finding a suitable location and recruiting enough volunteers. Financially, you need donations -- cash or in-kind -- to pay the bills and provide supplies for shelter residents. Politically, you'll have to win your city or county government's approval. Becoming a nonprofit can make it easier, as donors can write off what they give you as an itemized tax deduction.

Legal Set-Up

The best business structure for your nonprofit is probably a corporation. Check your state's website for guidelines on how to incorporate. Incorporating protects your personal assets from legal liability. It also lets you file as a tax-exempt nonprofit with the IRS, and that makes donations tax-deductible. You'll also need a local business license to operate in your town or county.

Find Volunteers

You can't create a homeless shelter single-handedly. The shelter needs people to staff it. A nonprofit corporation needs a board to make corporate decisions. Churches in many communities are actively working to help the homeless, so talking with pastors and congregations is one way to drum up volunteers. Finding board members can be tougher. You want directors who can fulfill the legal and financial obligations of running a nonprofit, but with enough diversity to reflect your community's population.

The Shelter Location

All kinds of places -- including empty hotels, church basements, private homes and abandoned government property -- have served as homeless shelters. Some nonprofits have built homeless shelters on donated land. Others rely on donated money or government support to buy or rent property. Your site has to conform to your local government's zoning and land-use codes, some of which may not allow homeless shelters. You'll also have to meet any other requirements your local government imposes.

Decide on Services

Putting a roof over people's heads is just one aspect of running a shelter. Many shelters offer other services, such as drug treatment, finding employment or finding a more permanent home. Adding more services requires more staff and takes a more demanding skill set. You can always start out just offering shelter and then add other services if your reputation grows enough to attract volunteers.

Look for Grants

The government offers a number of grant programs for homeless shelters. If your city government receives funds from HUD's federal Emergency Shelter Grants Program, it can use it to help you renovate a building as a homeless shelter. The grants can also pay for shelter repairs, rent, utilities and other costs. Some grants focus on specific subpopulations, such as homeless veterans. A Homeless Providers Grant -- available through a Department of Veterans Affairs program -- provides money for building or buying property to shelter homeless veterans.

Solicit Donations

Shelters need money, but they can use in-kind donations as well. People staying with you will need blankets and sheets, towels and soap, food and beverages, and toys for children. Businesses and individuals who don't have money to spare may be willing to donate goods instead. Working through churches and local charitable groups may put you in touch with people who can help out. Your board members should be willing to network and advocate to get more of the community involved.