How small can a 501c3 be?

If your nonprofit organization makes less than $5,000 per year, you may be able to obtain tax-exempt status from the IRS without filing a Form 1023 application.

How do you qualify for 1023-EZ?

That means they must:

  1. Anticipate less than $50,000 in annual gross receipts each year for the first 3 years, and.
  2. Have already had less than $50,000 in annual gross receipts for all 3 prior years (if any), and.
  3. Have total assets valued at under $250,000.

Who may file 1023-EZ?

Any organization that has gross receipts in each taxable year of normally not more than $5,000. Only certain organizations are eligible to apply for exemption under section 501(c)(3) using Form 1023-EZ. To determine if you are eligible to file Form 1023-EZ, you must complete the Form 1023-EZ Eligibility Worksheet.

How do you determine non profit organization size?

U.S. Small Business Administration (SBA)’s definition of a small business may be the most useful model for nonprofits. SBA’s definition is in terms of the average number of employees over the past 12 months, or average annual receipts over the past three years, but the limits vary by industry.

What is the difference between 1023-EZ and 1023?

Form 1023 is the application filed with the IRS in order to request exempt status under Section 501(c)(3). A new Form 1023-EZ was released in July 2014 to help smaller organizations seeking exempt status. Upon approval, the organization will receive a determination letter from the IRS.

How long does it take for IRS to approve 1023-EZ?

about 2-4 weeks
As the name suggests, Form 1023-EZ is easier to complete, and the rate of approval is very high, but there may be disadvantages to using this form. The average processing time for Form 1023-EZ is about 2-4 weeks. By contrast, Form 1023 can take between 3 and 6 months for processing, and it could take up to a year.

Can a private foundation file Form 1023-EZ?

Private operating foundations and certain other organizations cannot file a Form 1023-EZ.

What is the difference between a 1023 and a 1023-EZ?