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File for Federal Tax Exemption

You will need to file with the Internal Revenue Service for tax-exempt status under Section 501(c)(3). Form 1023 is the multi-page form you will need to file. Within three to six months of submitting your paperwork, you ordinarily will receive a letter, granting tax-exempt status to your organization.

Organizations that achieve 501(c)(3) status are exempt from federal taxes, and contributions given to them are deductible by donors for income tax purposes. In addition, the overwhelming majority of private foundations in the U.S. award grants only to organizations that have this particular tax-exempt status. See:

Although you can complete Form 1023 without outside assistance, it is not advisable to do so. Success in securing both state incorporation and federal tax-exempt status usually requires the assistance of an attorney, and competent legal counsel often helps the process move along smoothly. If you have limited financial resources, you might contact a public interest legal organization that connects nonprofit organizations with volunteer business lawyers. There is a growing network of those providers in cities all over the United States, coordinated by an organization in New York called Power of Attorney. You might also seek help from local technical assistance or management support organizations that specialize in providing guidance to nonprofit organizations.

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