Form 1023 preparation

What this service is

Form 1023 is the IRS application for recognition of exemption under section 501(c)(3). If the IRS approves it, you receive a determination letter, which is the official letter confirming your exempt status and your classification as a public charity or a private foundation. We prepare the whole application with you, from the first eligibility check through any follow-up questions from the IRS.

The narrative carries the application. The Form 1023 instructions say plainly that the IRS cannot recognize you as exempt based on a mission statement alone. It needs to understand the specific activities you will carry out: who does what, for whom, how often, where, and how it is paid for. Most of our work goes into describing your real program in that level of detail. Our Form 1023 guide walks through each part.

Who needs it

• New 501(c)(3) organizations that do not qualify for Form 1023-EZ, for example because projected annual gross receipts exceed $50,000 or because they are a school, hospital or supporting organization.
• Organizations that qualify for Form 1023-EZ but want the fuller review of Form 1023. See Form 1023 vs. 1023-EZ.
• Organizations filing more than 27 months after formation, which need Schedule E to address the effective date.
• Organizations seeking reinstatement after automatic revocation under the procedures that require Form 1023.

Not sure which form fits? Answer a few questions here.

What's included

• Eligibility review: we confirm your organizing document has the required purpose and dissolution clauses, check which application fits and identify your likely public charity or private foundation classification.
• Narrative of activities for Part IV, built from interviews with you.
• Compensation and financial arrangements in Part V, including how your board approves pay and handles conflicts of interest.
• Financial data for Part VI. An organization in existence less than one year provides three years of projections; one that has existed five years or more reports actual results for its five most recent years.
• Schedules that apply to you, such as Schedule A for churches, Schedule B for schools, Schedule E for effective date questions or Schedule H for grants to individuals.
• Attachments combined into the single PDF that Pay.gov accepts, in the order the instructions list: organizing document, amendments, bylaws and supporting statements.
• Pay.gov submission after your authorized officer approves and signs.
• Responses to IRS requests for additional information.

What we need from you

• Your filed articles, any amendments, your adopted bylaws and your EIN.
• A description of every current and planned program, in your own words.
• Your budget, or your actual financial statements if you have been operating.
• Names and roles of officers, directors and any paid staff, and any planned compensation.
• Copies of any leases, contracts or agreements with insiders.

How it works

1. Intake and quote. We review your documents and send a fixed quote before work starts.
2. Interviews. We ask detailed questions about your programs, finances and governance.
3. Drafting. We prepare the full application and attachments and send them for your review.
4. Signature. An officer, director, trustee or other authorized official of your organization reviews the final version and signs Part X. A representative cannot sign unless that person is also an authorized official.
5. Filing. The application is submitted on Pay.gov and the $600 user fee is paid to the IRS at that time.
6. Follow-up. If the IRS writes or calls with questions, we help you prepare a complete answer by the deadline in its letter. Our guide to IRS questions on your application shows what to expect.

What affects timing

Our part depends mainly on how quickly you supply information and return comments. After filing, timing is in the hands of the IRS. Its "Where's my application" page lists, for each form, the submission date it is currently working on and how many days it takes to issue 80 percent of determinations. Those figures change regularly, so read the date on the page rather than any number you saw elsewhere. The IRS expedites only for compelling reasons, such as a pending grant that the organization's operations depend on. See processing time and user fee.

501Nonprofit.com is a private company, not the IRS. This page is general information, not legal or tax advice for your organization. Example organizations and figures are hypothetical.