Non-profit Standing

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IRS 501c3 Status is the Way to Go

Non Profits with IRS 501c3 status are sometimes tough to start, however terribly rewarding in their activities. Although it may take effort to make a non profit, learn to fund them, and run it successfully, the task is worth it?s weight in gold.

There are a few things which make a serious difference when needing to start a charity. Many times per week I get asked why a charitable organization should file for IRS 501c3 status. You might or might not know that a non profit can be formed in a given state with non profit standing, although not IRS 501c3 status which makes it exempted from taxes. Exemption for a non profit is filed in addition to incorporating a non-profit corporation by completing and submitting the 501c3 form 1023 from the Office of the Treasury Internal Revenue Service. Once this form is submitted and accepted by the IRS, the non profit establishment then becomes exempt from tax.

The Coveted IRS 501c3 Status

This IRS 501c3 status is desired by most affiliations doing non profit work. The benefits are many, including although not restricted to, being exempt from tax and being able to accept donations and grant receipts to donors to subtract from their taxes. The ability to grant deductible receipts is a massive advantage as it draws donors who can use the tax deduction.

For many individuals, the facility to subtract donations from their taxes after giving to a tax-free non profit is an additional motivation to donate. When offered a choice to give to a non profit with IRS 501c3 status, which either an individual would be permitted the tax deduction or not, many would choose the former. Granted, depending on the subject?s tax status and amount of deductions, the individual might or might not really be well placed to use the reduction.

Why IRS 501c3 Status?

One may think to themselves, why would not every non profit seek IRS 501c3 status? The answer is many times financial and knowledge-based. Seeking exemption thru the IRS 501c3 application has steep filing costs associated with it that many non profits when only starting out can?t afford. Additionally, the IRS 1023 is lengthy and daunting in its completion. Due to these 2 reasons alone, many skip applying for exemption and rely on donations for which it?s grantors don?t require the tax reduction. It?s also possible that donors don?t understand that they won?t get a tax deduction for their donation when giving to nonexempt non profit Institutions.

When deciding on whether to file for tax exempt status as a non profit, the decision shouldn?t be difficult. Filing for exemption status is the proper answer. Getting the standing can be costly, but, there are more methods to get IRS 501c3 status without costing a fortune. It is worth spending your time and energy to investigate alternative systems of getting exempt status such as fiscal sponsorship.

To learn more about IRS 501c3 Status, Click Here ?->> http://SimpleNonprofit.com Scott Michael Ringo, an entrepreneur, is known worldwide as the nonprofit Guru and expert fundraiser because he helps others easily start and fund non profit charities all around the world. Through his work with nonprofits across the world he helps people start and run successful non-profit organizations. He?s a legacy builder and will help you build your nonprofit organization heritage.

Source: http://canarymagazine.net/business/non-profit-standing/

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