501c3 Filing Fee - IRS Form 1023 User Fee
Nonprofit organizations filing IRS Form 1023 – Application for Recognition of Exemption must include a Form 1023 User Fee payment as part of their application for either $400 or $850, made payable by check to the United States Treasury.
The Form 1023 filing fee amount is determined by your organization’s annual revenue over the next four years, and the IRS uses $10,000 per year as its benchmark. For example, if your organization’s projected annual revenue averages $10,000 or more during the next four years, then your application fee is $850. If your organization’s projected annual revenue averages less than $10,000 during the next four years, then your application fee is $400.
Unless you are absolutely certain that your organization’s projected annual revenue will exceed $10,000 per year during the next four years, it may be in your best interest as a startup nonprofit organization to project a bit more conservatively so that you’re only required to pay the $400 filing fee. Then, if you end up exceeding those numbers at any point during the next four years, you are able to make up the difference on your annual Form 990 filing.
On the other hand, if you are quite certain that your organization will exceed the $10,000 annual revenue benchmark over the next four years then you should submit the required IRS Form 1023 Filing Fee of $850.
If you have additional questions about the IRS Form 1023 User Fee, or how to determine what your 501c3 filing fee will be, please contact Nonprofit Elite. We’ll glad to help.