What steps are involved in the application process, and how long does it take to gain approval?  For a brand-new nonprofit organization, regardless of what state you’re operating in, the steps in the process include the following:

– Create Articles of Incorporation (sometimes called Certificate of Formation) and file with your specific state

– Apply for EIN from the IRS (also called Tax ID Number or Federal Employee Identification Number)

– Create organizational Bylaws

– Prepare IRS Form 1023 or Form 1024, Application for Recognition of Exemption, including narrative of activities, financial projections and information, schedules, additional notes, and supplemental materials

– Respond to any IRS follow up questions or requests, if applicable

501c3 Application Process and Timeline

Each of these completed documents, along with your $400 or $850 filing fee, then becomes part of your 501c3 application packet to be filed with the IRS.  You must place the documents in the correct order and make sure that nothing is missing.  Your filing fee payment is made by check and should be  made payable to the United States Treasury.  The check should be placed on top of your application and none of the forms should be attached by staples or paperclips.

Preparing your formation documents (Articles of Incorporation) and waiting for approval from the state takes usually takes between two days and a couple of weeks, depending on your filing method (mail, online, or fax) and the state in which you are incorporating.  Then, waiting for the IRS to review your 501c3 application packet takes somewhere between 2-9 months, although three to five months is more common.

Add all of this up, and a new nonprofit organization starting at the very beginning can expect at least three months and perhaps longer (4-7 months) before achieving 501c3 federal tax exempt status from the IRS.

If you have questions about applying for 501c3 exempt status or want to know more, please contact us at 1.800.268.4388.  We’re glad to help!