Reinstatement of Tax-Exempt Status after Automatic Revocation

Question. My organization’s tax-exempt status was revoked by the IRS. What can I do? Answer: If an organization has had its tax-exempt status automatically revoked and wishes to have that status reinstated, it must file an application for exemption and pay the appropriate user fee even if it was not required to apply for exempt… [Read More]

How to Maintain your Organizations Tax Exempt Status

Question: What should we do to maintain our organizations tax exempt status? Answer: Fortunately, it is not common for the IRS to actually revoke a nonprofit’s tax-exempt status. However, even if a nonprofit does not lose its tax-exempt status it may face stiff financial penalties the IRS refers to as “Intermediate Sanctions.” In order to… [Read More]

Avoiding the Taxation of Corporate Sponsorship Donations

Question: How can our organization avoid the Taxation of Corporate Sponsorship Donations? Answer: One effective way for a nonprofit to generate revenue is to pursue a corporate sponsorship wherein the sponsor makes cash or in kind donations in exchange for public awareness of its products. In order for these donations to remain tax-exempt, certain rules… [Read More]

Deductions for Contributions Made to a Charity before Its Tax-exemption Application is Approved

Question: My Texas nonprofit corporation filed its IRS Form 1023 and applied to the IRS to become a tax-exempt charitable organization. The current average wait time for the IRS to approve an application for tax-exempt status is well over a year. Can we tell prospective donors that their contributions to our charity while it’s tax-exempt… [Read More]

How Long is the IRS Taking to Approve Form 1023 Applications for Exemption?

Question: If my nonprofit corporation files its IRS Form 1023 today, how long will it take before the IRS issues a letter approving the corporation as a tax-exempt Section 501(c) charitable organization? Answer: According the the IRS’ website page called “Where Is My Exemption Application?” the IRS is now reviewing applications for tax-exemption filed in… [Read More]