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Federal Tax Obligations of Non-Profit Corporations

Non-profit status may make an organization eligible for certain benefits, such as state sales, property, and income tax exemptions; however, this corporate status does not automatically grant exemption from federal income tax. To be tax exempt, most organizations must apply for recognition of exemption from the Internal Revenue Service to obtain a ruling or determination letter recognizing tax exemption.

If you intend to apply to the IRS for recognition of federal tax-exempt status as a charitable organization under section 501(c)(3) of the Internal Revenue Code, your articles of incorporation must contain certain provisions. For more information, see Required Provisions for Organizing Documents.

To be exempt under section 501(c)(3) from the date of creation, an organization must apply within 27 months after  the end of the month in which it was created.

To learn about the general requirements for federal tax-exempt status, visit www.irs.gov/charities or download IRS Publication 557, Tax Exempt Status for Your Organization.

Although certain types of organizations are not required to apply for recognition of exemption, many do so in order to clarify their tax status. A user fee must accompany an exemption application. The IRS will not process an application until the user fee is paid.

Applications used to file for exemption

Section 501(c)(3) organizations

  • Form 1023, Application for Recognition of Exemption Under Section 501(c)(3) of the Internal Revenue Code

  • Form 1023-EZ, Streamlined Application for Recognition of Exemption Under Section 501(c)(3) of the Internal Revenue Code

  • Form SS-4, Application for Employer Identification Number (or apply for an EIN online )

Non-501(c)(3) organizations

  • Form 1024, Application for Recognition of Exemption Under Section 501(a) of the Internal Revenue Code

  • Form SS-4, Application for Employer Identification Number (or apply for an EIN online )

  • Form 8718, User Fee for Exempt Organization Determination Letter Request

Other help available from the IRS


Download forms and publications at www.irs.gov; or call 1-800-829-3676 (toll-free)


Charities and Nonprofits website www.irs.gov/eo

  • Life Cycles: Web-based information tools to help tax-exempt organizations comply with requirements that occur throughout the life cycle of their organization

  • IRS Stay Exempt site: tax basics for exempt organizations presented using web-based training modules and mini-courses

  • EO Update: free electronic newsletter with information for tax-exempt organizations and tax practitioners who represent them

TE/GE Customer Service: (877) 829-5500 (toll free)

 

Page Last Reviewed or Updated: 14-Dec-2016