The IRS 1023 form is an application used by organizations seeking tax-exempt status under Section 501(c)(3) of the Internal Revenue Code. It requires detailed information about the organization's purpose, activities, and finances. If you're looking to obtain tax-exempt status for your non-profit, click the button below to begin filling out the form.
For many organizations seeking recognition of tax-exempt status under Section 501(c)(3) of the Internal Revenue Code, navigating the application process is a crucial step. At the heart of this journey is the IRS Form 1023, a document that plays a pivotal role in establishing an organization's eligibility for tax exemption. This comprehensive form requires detailed information about the organization's structure, governance policies, financial data, and narrative descriptions of its activities. Completing the form can be a complex task, demanding careful attention to ensure accuracy and compliance with IRS requirements. Successful submission of Form 1023 not only paves the way for exemption from federal income tax but also allows organizations to receive tax-deductible contributions from donors, enhancing their fundraising capabilities. Given its importance, understanding the nuances of the IRS Form 1023 is the first critical step for nonprofit organizations aspiring to achieve their mission-driven goals while securing essential fiscal benefits.
Form 1023 is filed electronically only on Pay.gov.
Go to www.irs.gov/form1023 for additional filing information.
Form 1023
(Rev. December 2017)
Department of the Treasury
Internal Revenue Service
Application for Recognition of Exemption
Under Section 501(c)(3) of the Internal Revenue Code
▶Do not enter social security numbers on this form as it may be made public. ▶ Go to www.irs.gov/Form1023 for instructions and the latest information.
OMB No. 1545-0056
Note: If exempt status is approved, this application will be open for public inspection.
Use the instructions to complete this application and for a definition of all bold items. For additional help, call IRS Exempt Organizations Customer Account Services toll-free at 1-877-829-5500. Visit our website at www.irs.gov for forms and publications. If the required information and documents are not submitted with payment of the appropriate user fee, the application may be returned to you.
Attach additional sheets to this application if you need more space to answer fully. Put your name and EIN on each sheet and identify each answer by Part and line number. Complete Parts I – XI of Form 1023 and submit only those Schedules (A through H) that apply to you.
Part I
Identification of Applicant
1
Full name of organization (exactly as it appears in your organizing document)
2
c/o Name (if applicable)
3
Mailing address (Number and street) (see instructions)
Room/Suite
4
Employer Identification Number (EIN)
City or town, state or country, and ZIP + 4
5
Month the annual accounting period ends (01 – 12)
6
Primary contact (officer, director, trustee, or authorized representative)
a Name:
b
Phone:
c
Fax: (optional)
7Are you represented by an authorized representative, such as an attorney or accountant? If “Yes,” provide the authorized representative’s name, and the name and address of the authorized representative’s firm. Include a completed Form 2848, Power of Attorney and Declaration of Representative, with your application if you would like us to communicate with your representative.
Yes
No
8Was a person who is not one of your officers, directors, trustees, employees, or an authorized representative listed in line 7, paid, or promised payment, to help plan, manage, or advise you about the structure or activities of your organization, or about your financial or tax matters? If “Yes,” provide the person’s name, the name and address of the person’s firm, the amounts paid or promised to be paid, and describe that person’s role.
9a Organization’s website:
bOrganization’s email: (optional)
10Certain organizations are not required to file an information return (Form 990 or Form 990-EZ). If you are granted tax-exemption, are you claiming to be excused from filing Form 990 or Form 990-EZ? If “Yes,” explain. See the instructions for a description of organizations not required to file Form 990 or Form 990-EZ.
11
Date incorporated if a corporation, or formed, if other than a corporation.
(MM/DD/YYYY)
/
12
Were you formed under the laws of a foreign country?
If “Yes,” state the country.
For Paperwork Reduction Act Notice, see instructions.
Cat. No. 17133K
Form 1023 (Rev. 12-2017)
Name:
EIN:
Page 2
Part II Organizational Structure
You must be a corporation (including a limited liability company), an unincorporated association, or a trust to be tax exempt.
See instructions. DO NOT file this form unless you can check “Yes” on lines 1, 2, 3, or 4.
Are you a corporation? If “Yes,” attach a copy of your articles of incorporation showing certification of
filing with the appropriate state agency. Include copies of any amendments to your articles and be sure
they also show state filing certification.
Are you a limited liability company (LLC)? If “Yes,” attach a copy of your articles of organization showing
certification of filing with the appropriate state agency. Also, if you adopted an operating agreement, attach
a copy. Include copies of any amendments to your articles and be sure they show state filing certification.
Refer to the instructions for circumstances when an LLC should not file its own exemption application.
Are you an unincorporated association? If “Yes,” attach a copy of your articles of association,
constitution, or other similar organizing document that is dated and includes at least two signatures.
Include signed and dated copies of any amendments.
4a
Are you a trust? If “Yes,” attach a signed and dated copy of your trust agreement. Include signed and
dated copies of any amendments.
Have you been funded? If “No,” explain how you are formed without anything of value placed in trust.
Have you adopted bylaws? If “Yes,” attach a current copy showing date of adoption. If “No,” explain
how your officers, directors, or trustees are selected.
Part III Required Provisions in Your Organizing Document
The following questions are designed to ensure that when you file this application, your organizing document contains the required provisions to meet the organizational test under section 501(c)(3). Unless you can check the boxes in both lines 1 and 2, your organizing document does not meet the organizational test. DO NOT file this application until you have amended your organizing document. Submit your original and amended organizing documents (showing state filing certification if you are a corporation or an LLC) with your application.
1Section 501(c)(3) requires that your organizing document state your exempt purpose(s), such as charitable, religious, educational, and/or scientific purposes. Check the box to confirm that your organizing document meets this requirement. Describe specifically where your organizing document meets this requirement, such as a reference to a particular article or section in your organizing document. Refer to the instructions for exempt purpose language.
Location of Purpose Clause (Page, Article, and Paragraph):
2 a Section 501(c)(3) requires that upon dissolution of your organization, your remaining assets must be used exclusively for exempt purposes, such as charitable, religious, educational, and/or scientific purposes. Check the box on line 2a to confirm that your organizing document meets this requirement by express provision for the distribution of assets upon dissolution. If you rely on state law for your dissolution provision, do not check the box on line 2a and go to line 2c.
bIf you checked the box on line 2a, specify the location of your dissolution clause (Page, Article, and Paragraph). Do not complete line 2c if you checked box 2a.
c See the instructions for information about the operation of state law in your particular state. Check this box if you rely on operation of state law for your dissolution provision and indicate the state:
Part IV
Narrative Description of Your Activities
Using an attachment, describe your past, present, and planned activities in a narrative. If you believe that you have already provided some of this information in response to other parts of this application, you may summarize that information here and refer to the specific parts of the application for supporting details. You may also attach representative copies of newsletters, brochures, or similar documents for supporting details to this narrative. Remember that if this application is approved, it will be open for public inspection. Therefore, your narrative description of activities should be thorough and accurate. Refer to the instructions for information that must be included in your description.
Part V Compensation and Other Financial Arrangements With Your Officers, Directors, Trustees, Employees, and Independent Contractors
1a List the names, titles, and mailing addresses of all of your officers, directors, and trustees. For each person listed, state their total annual compensation, or proposed compensation, for all services to the organization, whether as an officer, employee, or other position. Use actual figures, if available. Enter “none” if no compensation is or will be paid. If additional space is needed, attach a separate sheet. Refer to the instructions for information on what to include as compensation.
Name
Title
Mailing address
Compensation amount (annual actual or estimated)
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Part V
Compensation and Other Financial Arrangements With Your Officers, Directors, Trustees, Employees,
and Independent Contractors (Continued)
bList the names, titles, and mailing addresses of each of your five highest compensated employees who receive or will receive compensation of more than $50,000 per year. Use the actual figure, if available. Refer to the instructions for information on what to include as compensation. Do not include officers, directors, or trustees listed in line 1a.
cList the names, names of businesses, and mailing addresses of your five highest compensated independent contractors that receive or will receive compensation of more than $50,000 per year. Use the actual figure, if available. Refer to the instructions for information on what to include as compensation.
The following “Yes” or “No” questions relate to past, present, or planned relationships, transactions, or agreements with your officers, directors, trustees, highest compensated employees, and highest compensated independent contractors listed in lines 1a, 1b, and 1c.
2a
Are any of your officers, directors, or trustees related to each other through family or business
relationships? If “Yes,” identify the individuals and explain the relationship.
Do you have a business relationship with any of your officers, directors, or trustees other than through
their position as an officer, director, or trustee? If “Yes,” identify the individuals and describe the business
relationship with each of your officers, directors, or trustees.
Are any of your officers, directors, or trustees related to your highest compensated employees or highest
compensated independent contractors listed on lines 1b or 1c through family or business relationships? If
“Yes,” identify the individuals and explain the relationship.
3 a
For each of your officers, directors, trustees, highest compensated employees, and highest
compensated independent contractors listed on lines 1a, 1b, or 1c, attach a list showing their name,
qualifications, average hours worked, and duties.
Do any of your officers, directors, trustees, highest compensated employees, and highest compensated
independent contractors listed on lines 1a, 1b, or 1c receive compensation from any other organizations,
whether tax exempt or taxable, that are related to you through common control? If “Yes,” identify the
individuals, explain the relationship between you and the other organization, and describe the
compensation arrangement.
4In establishing the compensation for your officers, directors, trustees, highest compensated employees, and highest compensated independent contractors listed on lines 1a, 1b, and 1c, the following practices are recommended, although they are not required to obtain exemption. Answer “Yes” to all the practices you use.
a
Do you or will the individuals that approve compensation arrangements follow a conflict of interest policy?
Do you or will you approve compensation arrangements in advance of paying compensation?
Do you or will you document in writing the date and terms of approved compensation arrangements?
Page 4
dDo you or will you record in writing the decision made by each individual who decided or voted on compensation arrangements?
eDo you or will you approve compensation arrangements based on information about compensation paid by similarly situated taxable or tax-exempt organizations for similar services, current compensation surveys compiled by independent firms, or actual written offers from similarly situated organizations? Refer to the instructions for Part V, lines 1a, 1b, and 1c, for information on what to include as compensation.
f Do you or will you record in writing both the information on which you relied to base your decision and its
source?
gIf you answered “No” to any item on lines 4a through 4f, describe how you set compensation that is reasonable for your officers, directors, trustees, highest compensated employees, and highest compensated independent contractors listed in Part V, lines 1a, 1b, and 1c.
5a Have you adopted a conflict of interest policy consistent with the sample conflict of interest policy in
Appendix A to the instructions? If “Yes,” provide a copy of the policy and explain how the policy has
been adopted, such as by resolution of your governing board. If “No,” answer lines 5b and 5c.
bWhat procedures will you follow to assure that persons who have a conflict of interest will not have influence over you for setting their own compensation?
cWhat procedures will you follow to assure that persons who have a conflict of interest will not have influence over you regarding business deals with themselves?
Note: A conflict of interest policy is recommended though it is not required to obtain exemption. Hospitals, see Schedule C, Section I, line 14.
6a
Do you or will you compensate any of your officers, directors, trustees, highest compensated employees, and highest
compensated independent contractors listed in lines 1a, 1b, or 1c through non-fixed payments, such as discretionary
bonuses or revenue-based payments? If “Yes,” describe all non-fixed compensation arrangements, including how the
amounts are determined, who is eligible for such arrangements, whether you place a limitation on total compensation,
and how you determine or will determine that you pay no more than reasonable compensation for services. Refer to
the instructions for Part V, lines 1a, 1b, and 1c, for information on what to include as compensation.
Do you or will you compensate any of your employees, other than your officers, directors, trustees, or your
five highest compensated employees who receive or will receive compensation of more than $50,000 per
year, through non-fixed payments, such as discretionary bonuses or revenue-based payments? If “Yes,”
describe all non-fixed compensation arrangements, including how the amounts are or will be determined, who
is or will be eligible for such arrangements, whether you place or will place a limitation on total compensation,
and how you determine or will determine that you pay no more than reasonable compensation for services.
Refer to the instructions for Part V, lines 1a, 1b, and 1c, for information on what to include as compensation.
7a
Do you or will you purchase any goods, services, or assets from any of your officers, directors, trustees, highest
compensated employees, or highest compensated independent contractors listed in lines 1a, 1b, or 1c? If “Yes,”
describe any such purchase that you made or intend to make, from whom you make or will make such purchases, how
the terms are or will be negotiated at arm’s length, and explain how you determine or will determine that you pay no
more than fair market value. Attach copies of any written contracts or other agreements relating to such purchases.
Do you or will you sell any goods, services, or assets to any of your officers, directors, trustees, highest
describe any such sales that you made or intend to make, to whom you make or will make such sales, how the
terms are or will be negotiated at arm’s length, and explain how you determine or will determine you are or will be
paid at least fair market value. Attach copies of any written contracts or other agreements relating to such sales.
8a
Do you or will you have any leases, contracts, loans, or other agreements with your officers, directors,
trustees, highest compensated employees, or highest compensated independent contractors listed in
lines 1a, 1b, or 1c? If “Yes,” provide the information requested in lines 8b through 8f.
bDescribe any written or oral arrangements that you made or intend to make.
cIdentify with whom you have or will have such arrangements.
dExplain how the terms are or will be negotiated at arm’s length.
eExplain how you determine you pay no more than fair market value or you are paid at least fair market value. f Attach copies of any signed leases, contracts, loans, or other agreements relating to such arrangements.
9a Do you or will you have any leases, contracts, loans, or other agreements with any organization in which
any of your officers, directors, or trustees are also officers, directors, or trustees, or in which any individual officer, director, or trustee owns more than a 35% interest? If “Yes,” provide the information requested in lines 9b through 9f.
Page 5
Compensation and Other Financial Arrangements With Your Officers, Directors, Trustees,
Employees, and Independent Contractors (Continued)
bDescribe any written or oral arrangements you made or intend to make.
eExplain how you determine or will determine you pay no more than fair market value or that you are paid at least fair market value.
fAttach a copy of any signed leases, contracts, loans, or other agreements relating to such arrangements.
Part VI
Your Members and Other Individuals and Organizations That Receive Benefits From You
The following “Yes” or “No” questions relate to goods, services, and funds you provide to individuals and organizations as part of your activities. Your answers should pertain to past, present, and planned activities. See instructions.
1 a In carrying out your exempt purposes, do you provide goods, services, or funds to individuals? If “Yes,” describe each program that provides goods, services, or funds to individuals.
bIn carrying out your exempt purposes, do you provide goods, services, or funds to organizations? If “Yes,” describe each program that provides goods, services, or funds to organizations.
Do any of your programs limit the provision of goods, services, or funds to a specific individual or group
of specific individuals? For example, answer “Yes,” if goods, services, or funds are provided only for a
particular individual, your members, individuals who work for a particular employer, or graduates of a
particular school. If “Yes,” explain the limitation and how recipients are selected for each program.
Do any individuals who receive goods, services, or funds through your programs have a family or
business relationship with any officer, director, trustee, or with any of your highest compensated
employees or highest compensated independent contractors listed in Part V, lines 1a, 1b, and 1c? If
“Yes,” explain how these related individuals are eligible for goods, services, or funds.
Part VII
Your History
The following “Yes” or “No” questions relate to your history. See instructions.
Are you a successor to another organization? Answer “Yes,” if you have taken or will take over the
activities of another organization; you took over 25% or more of the fair market value of the net assets of
another organization; or you were established upon the conversion of an organization from for-profit to
nonprofit status. If “Yes,” complete Schedule G.
Are you submitting this application more than 27 months after the end of the month in which you were
legally formed? If “Yes,” complete Schedule E.
Part VIII
Your Specific Activities
The following “Yes” or “No” questions relate to specific activities that you may conduct. Check the appropriate box. Your answers should pertain to past, present, and planned activities. See instructions.
1 Do you support or oppose candidates in political campaigns in any way? If “Yes,” explain.
2 a
Do you attempt to influence legislation? If “Yes,” explain how you attempt to influence legislation and
complete line 2b. If “No,” go to line 3a.
Have you made or are you making an election to have your legislative activities measured by
expenditures by filing Form 5768? If “Yes,” attach a copy of the Form 5768 that was already filed or
attach a completed Form 5768 that you are filing with this application. If “No,” describe whether your
attempts to influence legislation are a substantial part of your activities. Include the time and money
spent on your attempts to influence legislation as compared to your total activities.
3a Do you or will you operate bingo or gaming activities? If “Yes,” describe who conducts them, and list all revenue received or expected to be received and expenses paid or expected to be paid in operating these activities. Revenue and expenses should be provided for the time periods specified in Part IX, Financial Data.
bDo you or will you enter into contracts or other agreements with individuals or organizations to conduct bingo or gaming for you? If “Yes,” describe any written or oral arrangements that you made or intend to make, identify with whom you have or will have such arrangements, explain how the terms are or will be negotiated at arm’s length, and explain how you determine or will determine you pay no more than fair market value or you will be paid at least fair market value. Attach copies or any written contracts or other agreements relating to such arrangements.
cList the states and local jurisdictions, including Indian Reservations, in which you conduct or will conduct gaming or bingo.
Page 6
Your Specific Activities (Continued)
4 a Do
you or will you undertake fundraising? If “Yes,” check all the fundraising programs you do or will
conduct. See instructions.
mail solicitations
phone solicitations
email solicitations
accept donations on your website
personal solicitations
receive donations from another organization’s website
vehicle, boat, plane, or similar donations
government grant solicitations
foundation grant solicitations
Other
Attach a description of each fundraising program.
b Do you or will you have written or oral contracts with any individuals or organizations to raise funds for
you? If “Yes,” describe these activities. Include all revenue and expenses from these activities and state
who conducts them. Revenue and expenses should be provided for the time periods specified in Part IX,
Financial Data. Also, attach a copy of any contracts or agreements.
c Do you or will you engage in fundraising activities for other organizations? If “Yes,” describe these
arrangements. Include a description of the organizations for which you raise funds and attach copies of
all contracts or agreements.
dList all states and local jurisdictions in which you conduct fundraising. For each state or local jurisdiction listed, specify whether you fundraise for your own organization, you fundraise for another organization, or another organization fundraises for you.
e
Do you or will you maintain separate accounts for any contributor under which the contributor has the
right to advise on the use or distribution of funds? Answer “Yes” if the donor may provide advice on the
types of investments, distributions from the types of investments, or the distribution from the donor’s
contribution account. If “Yes,” describe this program, including the type of advice that may be provided
and submit copies of any written materials provided to donors.
Are you affiliated with a governmental unit? If “Yes,” explain.
Do you or will you engage in economic development? If “Yes,” describe your program.
bDescribe in full who benefits from your economic development activities and how the activities promote exempt purposes.
Do or will persons other than your employees or volunteers develop your facilities? If “Yes,” describe
each facility, the role of the developer, and any business or family relationship(s) between the developer
and your officers, directors, or trustees.
Do or will persons other than your employees or volunteers manage your activities or facilities? If “Yes,”
describe each activity and facility, the role of the manager, and any business or family relationship(s)
between the manager and your officers, directors, or trustees.
cIf there is a business or family relationship between any manager or developer and your officers, directors, or trustees, identify the individuals, explain the relationship, describe how contracts are negotiated at arm’s length so that you pay no more than fair market value, and submit a copy of any contracts or other agreements.
8 Do you or will you enter into joint ventures, including partnerships or limited liability companies
treated as partnerships, in which you share profits and losses with partners other than section 501(c)(3)
organizations? If “Yes,” describe the activities of these joint ventures in which you participate.
9a Are you applying for exemption as a childcare organization under section 501(k)? If “Yes,” answer lines 9b through 9d. If “No,” go to line 10.
bDo you provide childcare so that parents or caretakers of children you care for can be gainfully employed (see instructions)? If “No,” explain how you qualify as a childcare organization described in section 501(k).
cOf the children for whom you provide childcare, are 85% or more of them cared for by you to enable their parents or caretakers to be gainfully employed (see instructions)? If “No,” explain how you qualify as a childcare organization described in section 501(k).
dAre your services available to the general public? If “No,” describe the specific group of people for whom your activities are available. Also, see the instructions and explain how you qualify as a childcare organization described in section 501(k).
10 Do you or will you publish, own, or have rights in music, literature, tapes, artworks, choreography,
scientific discoveries, or other intellectual property? If “Yes,” explain. Describe who owns or will own any copyrights, patents, or trademarks, whether fees are or will be charged, how the fees are determined, and how any items are or will be produced, distributed, and marketed.
Page 7
Do you or will you accept contributions of: real property; conservation easements; closely held
securities; intellectual property such as patents, trademarks, and copyrights; works of music or art;
licenses; royalties; automobiles, boats, planes, or other vehicles; or collectibles of any type? If “Yes,”
describe each type of contribution, any conditions imposed by the donor on the contribution, and any
agreements with the donor regarding the contribution.
12 a
Do you or will you operate in a foreign country or countries? If “Yes,” answer lines 12b through 12d. If
“No,” go to line 13a.
Name the foreign countries and regions within the countries in which you operate.
Describe your operations in each country and region in which you operate.
d
Describe how your operations in each country and region further your exempt purposes.
13a
Do you or will you make grants, loans, or other distributions to organization(s)? If “Yes,” answer lines 13b
through 13g. If “No,” go to line 14a.
bDescribe how your grants, loans, or other distributions to organizations further your exempt purposes.
c Do you have written contracts with each of these organizations? If “Yes,” attach a copy of each contract.
dIdentify each recipient organization and any relationship between you and the recipient organization.
eDescribe the records you keep with respect to the grants, loans, or other distributions you make.
fDescribe your selection process, including whether you do any of the following.
(i)
Do you require an application form? If “Yes,” attach a copy of the form.
(ii)
Do you require a grant proposal? If “Yes,” describe whether the grant proposal specifies your
responsibilities and those of the grantee, obligates the grantee to use the grant funds only for the
purposes for which the grant was made, provides for periodic written reports concerning the use of
grant funds, requires a final written report and an accounting of how grant funds were used, and
acknowledges your authority to withhold and/or recover grant funds in case such funds are, or appear
to be, misused.
gDescribe your procedures for oversight of distributions that assure you the resources are used to further your exempt purposes, including whether you require periodic and final reports on the use of resources.
14 a Do you or will you make grants, loans, or other distributions to foreign organizations? If “Yes,” answer lines 14b through 14f. If “No,” go to line 15.
bProvide the name of each foreign organization, the country and regions within a country in which each foreign organization operates, and describe any relationship you have with each foreign organization.
cDoes any foreign organization listed in line 14b accept contributions earmarked for a specific country or specific organization? If “Yes,” list all earmarked organizations or countries.
dDo your contributors know that you have ultimate authority to use contributions made to you at your discretion for purposes consistent with your exempt purposes? If “Yes,” describe how you relay this information to contributors.
eDo you or will you make pre-grant inquiries about the recipient organization? If “Yes,” describe these inquiries, including whether you inquire about the recipient’s financial status, its tax-exempt status under the Internal Revenue Code, its ability to accomplish the purpose for which the resources are provided, and other relevant information.
fDo you or will you use any additional procedures to ensure that your distributions to foreign organizations are used in furtherance of your exempt purposes? If “Yes,” describe these procedures, including site visits by your employees or compliance checks by impartial experts, to verify that grant funds are being used appropriately.
Page 8
15
Do you have a close connection with any organizations? If “Yes,” explain.
16
Are you applying for exemption as a cooperative hospital service organization under section 501(e)? If
“Yes,” explain.
17
Are you applying for exemption as a cooperative service organization of operating educational
organizations under section 501(f)? If “Yes,” explain.
18
Are you applying for exemption as a charitable risk pool under section 501(n)? If “Yes,” explain.
19
Do you or will you operate a school? If “Yes,” complete Schedule B. Answer “Yes,” whether you operate
a school as your main function or as a secondary activity.
20
Is your main function to provide hospital or medical care? If “Yes,” complete Schedule C.
21
Do you or will you provide low-income housing or housing for the elderly or handicapped? If “Yes,”
complete Schedule F.
22
Do you or will you provide scholarships, fellowships, educational loans, or other educational grants to
individuals, including grants for travel, study, or other similar purposes? If “Yes,” complete
Schedule H.
Note: Private foundations may use Schedule H to request advance approval of individual grant procedures.
Page 9
Part IX
Financial Data
For purposes of this schedule, years in existence refer to completed tax years.
1.If in existence less than 5 years, complete the statement for each year in existence and provide projections of your likely revenues and expenses based on a reasonable and good faith estimate of your future finances for a total of:
a.Three years of financial information if you have not completed one tax year, or
b.Four years of financial information if you have completed one tax year. See instructions.
2.If in existence 5 or more years, complete the schedule for the most recent 5 tax years. You will need to provide a separate statement that includes information about the most recent 5 tax years because the data table in Part IX has not been updated to provide for a 5th year. See instructions.
A.Statement of Revenues and Expenses
Revenues
Expenses
Type of revenue or expense
Current tax year
3 prior tax years or 2 succeeding tax years
(a) From
(b) From
(c) From
(d) From
(e) Provide Total for
To
(a) through (d)
1Gifts, grants, and contributions received (do not include unusual grants)
2Membership fees received
3Gross investment income
4Net unrelated business income
5Taxes levied for your benefit
6Value of services or facilities furnished by a governmental unit without charge (not including the value of services generally furnished to the public without charge)
7Any revenue not otherwise listed above or in lines 9–12 below (attach an itemized list)
8Total of lines 1 through 7
9Gross receipts from admissions, merchandise sold or services performed, or furnishing of facilities in any activity that is related to your exempt purposes (attach itemized list)
10Total of lines 8 and 9
11Net gain or loss on sale of capital assets (attach schedule and see instructions)
12Unusual grants
13Total Revenue
Add lines 10 through 12
14 Fundraising expenses
15Contributions, gifts, grants, and similar amounts paid out (attach an itemized list)
16Disbursements to or for the benefit of members (attach an itemized list)
17Compensation of officers, directors, and trustees
18 Other salaries and wages
19 Interest expense
20 Occupancy (rent, utilities, etc.)
21 Depreciation and depletion
22 Professional fees
23Any expense not otherwise classified, such as program services (attach itemized list)
24Total Expenses
Add lines 14 through 23
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Financial Data (Continued)
B. Balance Sheet (for your most recently completed tax year)
Year End:
Assets
(Whole dollars)
Cash
Accounts receivable, net
Inventories
Bonds and notes receivable (attach an itemized list)
Corporate stocks (attach an itemized list)
Loans receivable (attach an itemized list)
7
Other investments (attach an itemized list)
8
Depreciable and depletable assets (attach an itemized list)
9
Land
10
Other assets (attach an itemized list)
Total Assets (add lines 1 through 10)
Liabilities
Accounts payable
13
Contributions, gifts, grants, etc. payable
14
Mortgages and notes payable (attach an itemized list)
Other liabilities (attach an itemized list)
Total Liabilities (add lines 12 through 15)
Fund Balances or Net Assets
Total fund balances or net assets
Total Liabilities and Fund Balances or Net Assets (add lines 16 and 17)
Have there been any substantial changes in your assets or liabilities since the end of the period
shown above? If “Yes,” explain.
Part X Public Charity Status
Part X is designed to classify you as an organization that is either a private foundation or a public charity. Public charity status is a more favorable tax status than private foundation status. If you are a private foundation, Part X is designed to further determine whether you are a private operating foundation. See instructions.
1 a
Are you a private foundation? If “Yes,” go to line 1b. If “No,” go to line 5 and proceed as instructed. If you
are unsure, see the instructions.
As a private foundation, section 508(e) requires special provisions in your organizing document in
addition to those that apply to all organizations described in section 501(c)(3). Check the box to confirm
that your organizing document meets this requirement, whether by express provision or by reliance on
operation of state law. Attach a statement that describes specifically where your organizing document
meets this requirement, such as a reference to a particular article or section in your organizing document
or by operation of state law. See the instructions, including Appendix B, for information about the special
provisions that need to be contained in your organizing document. Go to line 2.
Are you a private operating foundation? To be a private operating foundation you must engage directly in
the active conduct of charitable, religious, educational, and similar activities, as opposed to indirectly
carrying out these activities by providing grants to individuals or other organizations. If “Yes,” go to line 3.
If “No,” go to the signature section of Part XI.
Have you existed for one or more years? If “Yes,” attach financial information showing that you are a
private operating foundation; go to the signature section of Part XI. If “No,” continue to line 4.
Have you attached either (1) an affidavit or opinion of counsel, (including a written affidavit or opinion
from a certified public accountant or accounting firm with expertise regarding this tax law matter), that
sets forth facts concerning your operations and support to demonstrate that you are likely to satisfy the
requirements to be classified as a private operating foundation; or (2) a statement describing your
proposed operations as a private operating foundation?
5If you answered “No” to line 1a, indicate the type of public charity status you are requesting by checking one of the choices below. You may check only one box.
The organization is not a private foundation because it is:
a 509(a)(1) and 170(b)(1)(A)(i)—a church or a convention or association of churches. Complete and attach Schedule A. b 509(a)(1) and 170(b)(1)(A)(ii)—a school. Complete and attach Schedule B.
c509(a)(1) and 170(b)(1)(A)(iii)—a hospital, a cooperative hospital service organization, or a medical research organization operated in conjunction with a hospital. Complete and attach Schedule C.
d 509(a)(3)—an organization supporting either one or more organizations described in line 5a through c, f, h, or i or a publicly supported section 501(c)(4), (5), or (6) organization. Complete and attach Schedule D.
Completing the IRS Form 1023 requires careful attention to detail to ensure your organization is accurately presented and complies with the requirements for tax-exempt status. This form is a crucial step for non-profit organizations in establishing their eligibility for federal tax exemption. The process can be lengthy, but a well-prepared application is essential for gaining the benefits of exemption, including the ability to receive tax-deductible contributions. Follow these steps to guide you through properly filling out the form.
After submitting Form 1023, your organization may need to be patient. The review process can vary significantly in length, but you will eventually receive notification from the IRS concerning your tax-exempt status. During the wait, ensure your organization operates in accordance with the represented tax-exempt purposes and activities. This proactive approach will help streamline the acceptance of your application and your organization's transition into a tax-exempt entity.
The IRS 1023 form is a critical document used by nonprofits wishing to obtain federal tax-exempt status under section 501(c)(3) of the Internal Revenue Code. By submitting this form and getting approved, an organization can avoid paying federal income taxes. Additionally, it allows donors to claim tax deductions for their contributions. Completing the form requires detailed information about the organization's structure, governance, and programs.
Not all organizations need to file the IRS 1023 form, but it's necessary for:
Filling out Form 1023 involves providing detailed information about your organization, including:
The processing time for the IRS 1023 form can vary significantly, typically ranging from 3 to 12 months. The timeframe depends on several factors, including the complexity of your organization's structure and activities, the completeness of your application, and the current backlog at the IRS. Organizations can expedite their review by ensuring their application is thorough and includes all necessary documentation and clarifications.
Yes, an organization can lose its 501(c)(3) status if it fails to adhere to the compliance requirements. These could involve:
Not thoroughly reading the instructions is one of the most common errors. The IRS provides detailed instructions for completing Form 1023. Skipping these can lead to misunderstandings about what information is required and how it should be presented, potentially causing delays or rejection of the application.
Another mistake is providing incomplete answers. Each question should be answered fully to give the IRS a clear picture of the organization’s operations, structure, and purpose. Leaving sections blank or providing insufficient details may raise red flags.
Many organizations fail to clearly articulate their exempt purpose. It's critical to concisely describe how the organization’s activities fulfill a exempt purpose according to the IRS, such as charitable, religious, educational, or scientific purposes.
Incorrect financial information can significantly delay the review process. It's essential to provide accurate financial records, including past finances and projected budgets, ensuring they align with exempt purposes.
Forgetting to sign and date the form is a simple yet critical oversight. An unsigned or undated form can be considered incomplete and may be returned or rejected.
Neglecting to include necessary attachments or supplemental documents can hinder the application’s approval. These documents provide additional context and evidence supporting the application.
Choosing the wrong legal structure or status for the organization in the form can cause confusion and delays. It's vital to correctly identify the organization as a corporation, trust, association, etc., according to its legal registration.
Failing to describe planned activities in detail is a common shortfall. The IRS requires specific details about what the organization plans to do, including programs, services, and activities that justify tax-exempt status.
Incorrectly categorizing revenues and expenses in the financial section is a frequent error. This mistake can misrepresent the organization's financial health and operational efficiencies, casting doubt on its viability and compliance with tax-exempt status rules.
Lastly, not checking the IRS website for the most current version of Form 1023 or updates to the filing process can result in using outdated forms or missing new requirements, leading to an automatic rejection.
By avoiding these common mistakes, organizations can improve the likelihood of a smooth review process and successful attainment of tax-exempt status.
When applying for tax-exempt status under Section 501(c)(3) of the Internal Revenue Code, organizations commonly start with the IRS Form 1023. However, successfully navigating the exemption process often involves more than just this form. A variety of supporting documents and forms are usually needed to complement your application. These help in showcasing the organization's structure, activities, and financial practices. Here’s a rundown of documents commonly used alongside the IRS Form 1023.
Collectively, these documents paint a comprehensive picture of your nonprofit organization for the IRS. Being thorough and detailed in your documentation can facilitate a smoother application process for tax-exempt status. It’s always wise to consult with professionals who specialize in nonprofit law to ensure you’re submitting a complete and accurate application.
The IRS Form 1023 is akin to the IRS Form 1023-EZ, which also serves the purpose of seeking tax-exempt status but is designed for smaller organizations. The 1023-EZ offers a more streamlined application process, requiring less detailed information about the organization's activities, financials, and governance. This simplicity mirrors the difference between the two, where the comprehensive nature of the Form 1023 demands a more in-depth disclosure compared to the simplified, more accessible approach of the 1023-EZ.
Similar to the IRS Form 990, the Form 1023 requires detailed financial information but for a distinct purpose. While the Form 990 is an annual reporting requirement for existing tax-exempt organizations, focusing on their financial activities, revenue, and expenses over the fiscal year, the Form 1023 is used initially to establish tax-exempt status with the IRS. Both forms, however, necessitate a thorough accounting of the organization's finances, underscoring their operational transparency and accountability to the IRS.
The IRS Form SS-4, the Application for Employer Identification Number (EIN), shares a procedural similarity with the Form 1023 in terms of establishing a foundational element for organizations. Applying for an EIN is a prerequisite for organizations before filing Form 1023, as it identifies the entity in the IRS's systems. Both are initial steps for organizations in structuring their operations within federal guidelines, with the SS-4 facilitating tax identification and the 1023 establishing tax-exempt status.
Comparable to state-level nonprofit incorporation documents, the IRS Form 1023 addresses the federal aspect of an organization's formal recognition. State incorporation documents are the initial step in recognizing an entity's legal status at the state level, providing it with legal personality and the ability to engage in activities protected under state law. The Form 1023 complements this by seeking recognition of the organization’s tax-exempt status at the federal level, focusing on the tax-related privileges that accompany federal acknowledgment of their nonprofit status.
Filling out the IRS 1023 form, a critical step for organizations seeking tax-exempt status under Section 501(c)(3), demands attention to detail and a comprehensive understanding of the requirements. This guide outlines key dos and don'ts to navigate the process efficiently and avoid common pitfalls.
Do:
Don't:
The IRS 1023 form is crucial for organizations seeking tax-exempt status under section 501(c)(3) of the Internal Revenue Code. However, misconceptions about the form abound, often leading to confusion and unnecessary mistakes. Below are seven common misunderstandings about the form, explained and clarified.
Only large organizations need to file it. Some believe that the IRS 1023 form is only for large entities. In reality, it is required for all organizations desiring recognition of their tax-exempt status under section 501(c)(3), irrespective of their size.
You must file the form immediately after incorporation. While timely filing is important, organizations have 27 months from the date of incorporation to file Form 1023 to be recognized as tax-exempt from the date of incorporation. This window allows organizations to adequately prepare their application.
All parts of the form must be completed by all applicants. The form is comprehensive, but not every section applies to every applicant. Some parts of the form are specific to certain types of organizations and can be skipped by others. Carefully reading the instructions can clarify which parts of the form are relevant to your organization.
The process is completed quickly. The review process can be lengthy, sometimes taking up to 6 months or more. This timeframe can vary based on the accuracy of the application and the current backlog at the IRS.
The form can only be filed by a lawyer. While legal assistance can be helpful, especially for complex cases, organizations can complete and file Form 1023 on their own. Many resources are available to guide organizations through the process. However, seeking professional advice for unclear or complicated situations is a good practice.
Filing Form 1023 guarantees tax-exempt status. Filing the form is a request for recognition of exemption; it does not automatically guarantee that the IRS will grant tax-exempt status. The application needs to be thorough and comply with all IRS requirements for exemption under section 501(c)(3).
Once granted tax-exempt status, it cannot be revoked. The IRS can revoke tax-exempt status if an organization fails to comply with the ongoing requirements, such as filing the necessary annual reports or engaging in prohibited activities. Continued compliance is essential to maintain tax-exempt status.
The IRS Form 1023 is instrumental for organizations seeking recognition of exemption under Section 501(c)(3) of the Internal Revenue Code. This designation is crucial for non-profit entities aiming to obtain tax-exempt status, thereby allowing them to operate more efficiently in pursuit of their charitable goals. The process of completing and submitting this form is detailed, requiring thorough preparation and understanding of its various components.
Filing the IRS Form 1023 is a significant step for any organization striving to achieve and maintain tax-exempt status under 501(c)(3). The process is demanding but ultimately rewarding for those committed to advancing charitable, educational, or religious causes. By adhering to these key takeaways, organizations can navigate the application process more smoothly and position themselves for success.
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