Section 501(c)(3) of the Internal Revenue Code describes an organization’s requirements that are needed in order to achieve tax-exempt status. This section of the tax code outlines what it is to be tax-exempt as a religious, scientific, literary, educational and other charitable organizations. The simplified guidelines are as followed:
“An organization must be organized and operated exclusively for exempt purposes set forth in section 501(c)(3), and none of its earnings may inure to any private shareholder or individual. In addition, it may not be an action organization, i.e., it may not attempt to influence legislation as a substantial part of its activities and it may not participate in any campaign activity for or against political candidates.” -IRS
Form 1023 is the application for organizations that wish to be tax-exempt under section 501(c)(3). In order to be legally recognized as a tax-exempt organization under 501(c)(3), this form must be filled out in it’s entirety. The form can be found online in PDF form. The form must be filled out, printed, and the hardcopy must be mailed to the IRS for review and approval. The alternative form, 1023-EZ, is known to be much simpler and easier to complete. To learn the difference between these forms, check out our blog “Difference between a 1023 and a 1023-EZ”
Section 501(c)(3) outlines the qualifications of a tax-exempt organization in certain respects while Form 1023 must be filled out in order to obtain the tax-exempt status. Filing for tax-exempt status can take upwards of 100 hours according to IRS estimates, but Resilia’s ExemptMeNow application reduces that time by as much as 90 percent, or more! Our automated online service makes filing simpler and faster while gathering all of your exemption status data in one central storehouse. That means maintaining your status over your nonprofit’s lifecycle will be simpler as well.