Nonprofit Elite Blog
IRS Taking Longer to Review 501c3 Applications / Form 1023
The last few months we’ve noticed a significant increase in the amount of time that the IRS is taking to review and approve applications for 501c tax exemption. During the first six months of 2012, our clients were receiving their Letters of Determination on average within 3-5 months. More recently, a number of our clients are well into their fifth and sixth month of waiting. Since there is no effective way to expedite the process, we encourage you to plan accordingly and to contact us if you have questions.
501c3 Application Process and Timeline
[custom_frame_right shadow="on"][/custom_frame_right] What steps are involved in the 501c3 application process, and how long does it take to gain approval? For a brand-new nonprofit organization, the 501c3 application process usually includes the following: - Create Articles of Incorporation (Certificate of Formation) and file with state - Apply for EIN (Tax ID#) - Create Bylaws - Prepare IRS Form 1023 or Form 1024, Application for Recognition of Exemption, including narratives, financial information, schedules, and additional notes - Respond to any IRS follow up questions or requests
501c3 Application Mistakes
[custom_frame_right shadow="on"] [/custom_frame_right] Sometimes we’re approached by clients who have already filled out IRS Form1023 but want us to review their work before filing — and we are happy to do it. Here are three common mistakes that we see again and again: 1. Incomplete Purpose Clause and/or Missing Dissolution Clause in Organizing Document (Articles of Incorporation) – Section 501c3 of the Internal Revenue Code requires that your organizing document state your exempt purpose(s), such as charitable, religious, educational, and/or scientific purposes. Likewise, the code states that upon dissolution of your organization, your remaining assets must be used exclusively for exempt purposes, such as charitable, religious, educational, and/or scientific purposes.
How Long Does it Take to Get 501c3 Tax Exempt
Understandably, this is one question that we hear over and over again from startup nonprofit organizations looking for 501c3 tax exemption from the IRS. Just yesterday I heard from a woman who told me that an online startup “service” had told her it was possible to have her 501c3 application successfully processed within 30 days. Of course, now she wanted to know if we could do it even faster. The truth is, the IRS can take between 2-5 [...]
How to Start a Nonprofit: Internal Processes and Systems
[custom_frame_left shadow="on"]
[/custom_frame_left] This is the conclusion of a five-part series on how to start a nonprofit organization. Keep in mind that the sequence in which you complete these tasks may vary, but each is important. This final post will explore the steps to creating your Internal Processes and Systems.
Internal Processes / Systems
1. Set up operating procedures: Creating a set of operating procedures should make your day-to-day operations run more smoothly, not the opposite. If you are new to this sort of thing, sit down with another nonprofit director who has been at this for awhile. There’s no need to learn all of your lessons the hard way.
How to Start a NonProfit: 501c3 Application & State Registrations
[custom_frame_right shadow="on"]
[/custom_frame_right] This is the fourth part in a five-part series on how to start a nonprofit organization. Keep in mind that the sequence in which you complete these tasks may vary, but each is important. This post will explore the steps involved in applying for 501c3 tax exemption and state and local permits.
501c3 Tax Exemption
1. Prepare IRS Form 1023