Nonprofit Organizations: Basic Requirements

Nonprofit Organizations (other than churches) must file for federal tax exemption under the provisions of IRC § 501(a).  Many of the organizations that desire to qualify as charities file for exemption and attempt to qualify under the provisions of IRC § 501(c)(3).  A § 501(c)(3) organization must be both (1) organized and (2) operated in accordance with its exempt purpose.  To meet (1), a complex organizational process must be followed which will include the filing of a form 1023 with its associated schedules and disclosures.  Once the § 501(c)(3) has been successfully organized, it must be continually (2) operated in accordance with its exempt purpose.