IRS Makes Applying for 501(c)(3) Tax-Exempt Status Easier

The Internal Revenue Service (IRS) currently recognizes more than one million 501(c)(3) organizations and has more than 60,000 501(c)(3) applications pending. On July 1, 2014, the IRS introduced a new, streamlined application form to help small charities more easily apply and obtain 501(c)(3) tax-exempt status. Form 1023-EZ, which is 3 pages long compared to the 26 page comprehensive Form 1023, is available for most small organizations with projected gross receipts of $50,000 or less for the first three years and total assets with a fair market value less than $250,000. The filing instructions for Form 1023-EZ include a 26 question eligibility worksheet that must be completed to determine if they are eligible to file the shortened form. Form 1023-EZ must be filed online at http://www.pay.gov and a $400 user fee is due at the time the form is submitted.

It should also be noted that many organizations may be considered tax exempt without filing Form 1023-EZ or Form 1023.

  • Churches, including synagogues, temples, and mosques.
  • Integrated auxiliaries of churches and conventions or associations of churches.
  • Any organization that has gross receipts in each taxable year of normally not more than $5,000.

Levin Swedler Crum – Certified Public Accountants consults many non-profit organizations on not only the tax-exempt application process but also on the IRS annual filing requirements to maintain tax-exempt status.

Written by: Matthew Migal, CPA

Levin Swedler Crum - CPAs

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About akroncpa

Levin Swedler Kennedy is an Akron, Ohio CPA Firm, offering business and not-for-profit consulting, financial statement preparation, tax preparation & planning, QuickBooks & Peachtree support, auditing, and business valuations since 1986.
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