Non-profits: How do I get 501c3 status for my non-profit?

December 30, 2014 - Categories: Legal Articles

There are several steps to take to get your organization qualified for tax-exempt status with the IRS under section 501(c)3 of the IRS code.

1. You must incorporate your organization as a non-profit corporation with your state. This is done through your state process for incorporating. Note: Your Articles of Incorporation must have several specific statements that the IRS requires in order to grant you with 501c3 status.

2. Get an Employer ID Number with the IRS. You can do this online at the IRS website. With #1 and #2, you can now open a bank account in the name of your organization.

3. Create your By-laws for your corporation. Again, these by-laws must have several specific statements that the IRS requires for your 501c3.

4. Go to the IRS website and complete the 1023 EZ worksheet to see if you qualify for the streamlined application process for 501c3 status. If yes, you can follow this simpler process under 1023EZ.

5. If you don't qualify for the 1023EZ application process, then you can still apply online for 501c3 status through the normal 1023 process.

6. As of this writing, the IRS Fee is $400.

7. As of this writing, the IRS is taking about 8 months to approve 501c3 applications. However, once you apply and pay the fee, you are allowed under IRS rules to stop paying taxes on exempt income, and also to advertise that your donors can immediately tax-deduct their donations to your organization.

If you need help with any of the above steps or documents, please contact Access Legal Care for a free phone legal consultation at 855-437-3704.