Establishing and maintaining tax exempt status can be challenging. First, you must establish the TYPE of non-profit you would like to start. There are many different types of non-profit organizations available to choose from with 501(c)(3) being the most common. A 501(c)(3) organization allows donors to document and deduct their charitable contributions (limits apply). Second, you will need to establish the organization as a business entity or trust and we recommend consulting an attorney to do so. Third, information will need to be gathered to complete the determined tax-exempt application (1023, 1023EZ (filed online) or 1024 applications). This information includes financial budgets, projections and forecasts for up to 5 years, types of marketing to donors for soliciting funds, and details about your mission and specifically who or what charitable purpose you will serve and how.
Approval of the application for tax exempt status with the IRS can take anywhere from 7 days to over 6 months depending on the additional information needed by the IRS.
Contact our NFP specialists to help you navigate through the start-up of your NFP:
Heather M Dolen, CPA
Audit Partner
hdolen@mhrcpa.com
See Bio
Jacob B. Horsley
Associate
jhorsley@mhrcpa.com
See Bio
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