Our attorneys evaluate structure and determinant attributes to gauge probable success of an application for Federal income tax-exempt status under Internal Revenue Code Section 501(c)(3), including:
- Exercise of reasonable care by founders and initial directors to plan for the future of the organization;
- Number of independent board members; and
- Startup capital, social network, and/or experience raising funds.
Catalyst offers fixed fee services to apply for federal tax-exempt status, including, but not limited to:
- Advise on initial business plan and budget (referrals to nonprofit operations consultants and advisors upon request);
- Recommend whether to pursue public charity or private foundation status and educate clients with respect to these two options and other alternatives (e.g. supporting organizations, advocacy organizations, scholarship funds, etc.);
- Prepare and file IRS application for tax-exempt status (Form 1023 or Form 1024) and related statements;
- Prepare and file IRS Power of Attorney, Form 2848, to authorize attorneys to represent the organization with respect to the Form 1023 or Form 1024 application; and
- Respond to IRS follow-up questions and related correspondence, if applicable.
We welcome all types of nonprofit organizations seeking assistance for recognition of tax-exempt status. Some complex organizations may not be eligible for fixed-fee formation services, including, but not limited to:
- Schools;
- Hospitals;
- Churches;
- Domestic organizations with international activities; and
- Other initiatives seeking tax-exempt status on the basis of novel or untested theories.
We also provide assistance to existing organizations or associations that need to modify their relationships, structure, or activities in order to qualify for tax-exempt status.
