What is a 501(c)(3) application?


Quick Answer

A 501(c)(3) application is a request for tax exemption status from the Internal Revenue Service, according to the IRS website. This application, if approved, grants organizations the right to not pay any federal taxes due to their charitable or social service-oriented goals.

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Full Answer

The 501(c)(3) application is actually IRS Form 1023, which is up to 28 pages long, according to 501c3.org. It requires organizations supply information, such as the organizational structure, purpose, future plans and financial information. Applicants also need to supply various documentation including, a power of attorney and declaration of representative form, the group's articles of organization and bylaws, all completed schedules, a user fee and other required paperwork. The user fee is like an application processing fee and varies between $400 and $850, according to the IRS.

The process of gathering all required documentation and getting it in order for the application can be involved. The IRS makes information pages about the application process and who qualifies for the application available to everyone at its official website, under the "Help & Resources" tab and in the "Charities & Nonprofits" link on the left side of the page.

The best time to file for tax exemption status is within 15 months of the organization forming, according to 501c3.org. After that, the organization may have to apply for an extension to file Form 1023 with the IRS and might have trouble getting approved retroactively if it takes longer than 27 months to apply.

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