Q:

How do charities procure a tax-exempt form in Texas?

A:

Quick Answer

The Application for Exemption – Charitable Organization Form AP-205 – is available online at Comptroller.Texas.gov, according to the website. Click on the Forms link located on the top right of the home page.

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How do charities procure a tax-exempt form in Texas?
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Full Answer

Enter AP-205 in the Forms Search box on the Your One-Stop Source for Comptroller Forms webpage and click Go, instructs the Comptroller website. Click AP-205 Application for Exemption – Charitable Organization on the results page to download the form.

The state Comptroller's office notifies applicants of the application status within 10 business days of receipt, explains the Comptroller website. The Comptroller's office may require additional documentation to establish exemption eligibility.

Form AP-205 is used by nonprofit charitable organizations to request exemption from certain Texas taxes, including sales and franchise tax and hotel occupancy, notes the Comptroller website. In order to qualify as a charitable organization, the nonprofit entity must devote most or all of its activities to the alleviation of pain and suffering, disease and poverty by providing services to indigent or other deserving individuals through the dispensation of food, shelter, medicine, counseling or medicinal drugs.

Federal exemption status is not required for exemption status on the state level, advises the Comptroller website. However, the organization must acquire its primary funding from sources other than service charges or fees.

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