The 501c3 Application – What you should know
The process for applying for the 501c3 application is thought to be a lot more complex than it actually is. Most people know that the 501c3 application is used by a church to get relief from taxes. However, that is just the tip of the iceberg.It is also used by corporations, community chest funds, foundations, and organizations for purposes that are charitable, scientific, religious, literary, and educational in nature.
The purposes could also be to promote amateur sports and in some cases even research. Needless to say, a wide variety of organizations fall under the categories enumerated in Section 501c3. Thus, there definitely exists a broad section of society who needs guidance on the application form and how to go about filling it out.
So what if you were looking to set up a non-profit corporation? Yourconfusionwould be even more prominent and you wouldn’t know where to begin. It is also not necessary to pay someone else to fill out your forms when setting up a nonprofit.If you have a legal background, you should use it to its fullest, but if you don’t it is advisable and much more convenient to have some help. Moreover, you may also end up doing a balancing act, since if the business is meant to be not for profit, it would not make any sense to blow up a lot of money on setting it up!
The 501c3 application lets you create an independent nonprofit organization. Personally, I think that non-profit organizations have an advantage since they have no external interference. However, the paperwork needed to file the application is complex and costly, that is if you’re paying someone to do your filing.
The IRS asks you to collect particular documents and fill out the form 1023 with the completion of all formalities mentioned herein. The IRS charges between $400 and $850 per application. Professional help is generally recommended since the forms are somewhat difficult to fill on your own.
Furthermore, the form 1023 may take anywhere from a couple of weeks to a couple of months to fill. Applicants usually believe that once they fill out the form they will be able to get tax exempt status in a matter of a few days. The process of tax exemption is serious and IRS processing and review can take manymonths.
Some important factors that can affect the IRS processing time of an application include: the type of exemption application theperson has submitted, completeness of the application, and present workload of the IRS reviewers.
This articles was commissioned by Nonprofit Foundry, LLC, Milwaukee WI. It is not legal advice. Every situation is unique based on facts and circumstances. If you need legal advise contact an attorney.
Processing your request, Please wait....
