How Much Fee You Pay To Register Your 501 (C)(3) Non Profit

Becoming a 501(c)3 organization allows your charity to go exempt from taxes. Learn how to obtain this important legal condition.

In that location are many benefits to officially forming a nonprofit organization. Once y'all proceeds official 501(c)3 status, you can apply for grants, become tax-exempt, and protect yourself from liability. Formally becoming a 501(c)three too elevates your position in others' eyes and may make it easier for yous to receive donations to help your cause.

Applying for 501 (3) (C)

What Is a Nonprofit?

A nonprofit organization is i whose purpose is non to earn a profit but instead to do charitable work or public service. A tax-exempt system is officially recognized by the Internal Acquirement Service (IRS) as exempt from paying federal income taxation.

A 501(c)3 organization is a type of nonprofit that meets specific provisions in the Internal Revenue Code. A clemency or nonprofit profit organization does not demand this designation to grade or to receive donations. However, if your organization does not qualify for other types of tax-exempt statuses, you are considered a for-profit entity and subject to federal income revenue enhancement.

Who Can Employ?

To grade a 501(c)3 system, you must fall nether one of the exempt purposes listed in the Internal Acquirement Code. Qualifying purposes include:

Charitable
Religious
Educational
Scientific
Literary
Testing for public safety
Fostering national or international amateur sports competitions
Preventing cruelty to children or animals

Other types of organizations tin qualify for tax-exempt condition under different sections of the law (such equally section 501(c)iv), including civic leagues, agronomical organizations, chambers of commerce, and fraternal societies.

A complete list of qualifying organizations can be plant in the Internal Acquirement Code, Section 501(c). Action organizations that seek to influence legislation do non qualify and neither practice organizations with income that benefits private individuals.

How Can I Apply?

To employ for 501(c)three status, start by registering your organization with your state and then file with the federal government. Follow these steps:

Search your land's secretary of state database to be sure the name of your organization is available.
Complete your state's corporation registration process, which includes articles of incorporation, indicating what kind of nonprofit your entity will exist.
Utilise for an employee identification number (EIN) from the IRS, which functions every bit your organisation's tax number, similar to a Social Security number for an private.
File an IRS Form 1023, Application for Recognition of Exemption under Section 501(c)3 of the Internal Revenue Lawmaking, or Form 1023EZ, the streamlined version. Use the EZ grade if your system has less than $50,000 in gross receipts and less than $200,000 in assets. You have xv months from the date you formed your organization to file this document, just extensions are available. The form is lengthy, detailed, and complex, so you lot may need professional person help to complete information technology.
Request a state tax exemption by submitting your IRS letter of tax-exempt status to the appropriate state entity, if your land requires this.
Asking state charitable solicitation status, which almost states require if you lot will be seeking donations.
Write your corporation's bylaws—the rules it volition follow as it does business organization, convenes meetings, votes, and holds elections.
Appoint a board of directors to assist you in running the nonprofit.

Costs of Filing for a 501(c)three

Although you are starting an organization that'south purpose is not to make a turn a profit, some costs are associated with legally obtaining nonprofit status. Here are costs you need to consider:

State incorporation fee. Each state has its ain fee schedule for filing incorporation papers and obtaining copies of your registration, ranging from $50 to over $100.
IRS fee. You will need to pay $600 to file Form 1023 or $125 to file Form 1023EZ.
Annual report. Your system will need to file an annual report with your country, and fees will vary, usually betwixt $100 and $200.

Forming a nonprofit organization requires careful planning and attention to detail, just checking all the boxes will allow you to kickoff on the correct foot and meet your goals.