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EO Operational Requirements: Requirements for Publicly Supported Charities

What must a 501(c)(3) organization do to be classified as a publicly supported organization (rather than as a private foundation)?

A section 501(c)(3) organization may be classified as a public charity (rather than as a private foundation) on the basis that it is publicly supported. An organization is considered publicly supported if:

  1. It normally receives a substantial part of its support from a governmental unit or from contributions from the general public; or,
  2. It normally receives more than one-third of its support from gifts, grants, contributions, or gross receipts from activities related to its exempt purposes, and not more than one-third of its support from gross investment income.

In addition, the organization must meet the requirements of detailed support tests.

Generally, an organization computes its support over a five-year period that includes the current tax year. The organization must establish it meets the public support test by showing it is publicly supported on its Return of Organization Exempt From Income Tax or Form 990-EZ, Short Form Return of Organization Exempt From Income Tax (Schedule A) to Form 990, Return of Organization Exempt From Income Tax or Form 990-EZ, Short Form Return of Organization Exempt From Income Tax (Schedule A) to Form 990, Return of Organization Exempt From Income Tax or Form 990-EZ, Short Form Return of Organization Exempt From Income Tax, if it is required to file one of those returns.

Additional information

On-line mini-course - Foundation classification

 

 

Action required by small organization required to file Form 990-N

Page Last Reviewed or Updated: 18-Feb-2014