Tax Exempt Status

Besides charitable organizations described in section 501(c)(3) of the Internal Revenue Code, there are over twenty different types of organizations that may receive federal income tax exemption.  I advise on the right federal tax exempt status for your organization’s mission.   Also, we will discuss the requirements for securing state and local tax exemption.

The key considerations for tax exempt status are:

  • Identifying the appropriate tax exempt entity
  • Allowing donor deductions for charitable contributions
  • Providing benefits to members, if any
  • Understanding the federal tax law prohibitions against private inurement, private benefit, and self-dealing/excess benefit transactions
  • Complying with charitable solicitation and substantiation rules
  • Operating as a public charity versus a private foundation
  • Seeking tax-exempt status under a group ruling
  • Completing IRS Form 1023 (section 501(c)(3) charitable organizations), IRS Form 1024 (all other tax-exempt organizations except section 501(c)(4) social welfare organizations), and new IRS Form 1024-A (only section 501(c)(4) social welfare organizations)
  • Filing IRS Form 990, 990-EZ or 990-N