art by Scott's niece, Genevera
Obtaining and Retaining Exempt Status
To be recognized by the IRS as an exempt organization, 501(c)(3) non-profits must file Form 1023. It is an involved application that requires numerous attachments, including Articles of Incorporation and Bylaws, financial information (including budgets), information about the officers and directors, and a complete description of past, present, and planned exempt activities.
Churches do not need to file Form 1023, though it is advantageous to do so for several reasons. The IRS will issue a determination letter of exempt status that can be used to "prove" tax exempt status to donors.
Form 990 is an annual informational return that needs to be filed by charitable, religious, and educational non-profit organizations (churches are exempt from this filing) whose gross receipts average $25,000 or more per year. Even those non-profits under that threshhold now have a filing requirement.
Scott continues to help numerous non-profits through the sometimes confusing and certainly time consuming process of becoming exempt and continuing to meet IRS and state tax requirements. It is especially important for a non-profit, that is accountable to their donors and supporters, to seek this expert advice and continually provide professional financials and information.